Tips To Sell A Rental Property After Tenants Have Damaged It
Have you ever had nasty tenants that leave disaster in their wake? Maybe you've had it up to here with being a landlord, and you're looking to sell that damaged rental property altogether. While it can be a frustrating situation to navigate, it's not impossible to pick up and move on.
Damage is damage. No matter the severity, whether it's a stained carpet or broken glass, it can result in a host of issues when the time comes to sell. With lists upon lists of tasks to accomplish at sale time, the stress from such daunting feats might feel impossible. If you're not afraid of a challenge, you may choose to renovate and maximize your sale price. But, for those seeking a quick sale with minimal fuss, companies like Florida Cash Home Buyers will purchase your property in spite of damage, without charging a commission.
Here are some tips on how to sell a rental property after tenants have damaged it.
Navigating The Damage
Before putting your property on the market, take extensive notes, photos, and recordings of any damage, and compare those to the integrity of the property prior to when they moved in. Most of the time, you're not going to be adequately aware of any damage done until after the move-out inspection, so brace yourself for the worst to adjust adequate expectations.
Of course, it's common for lease agreements to allow you to withhold security deposits, but the damage might extend beyond that amount. After the initial bond, it could be next to impossible to get any reparations afterwards.
To calculate whether you're best to repair the property first and then sell, or put it on the market as-is, gather quotes for the costs to fix the property and consult with a real estate professional for an appraisal on its value. Sometimes, you may think maintenance work is essential to make a profit, but buyers may be happy to purchase it and do the renovations themselves, thus saving you time and money.
Handling The Damage
The stress of rental damages can be absolutely devastating, so it's important you understand all viable options available before taking any action. Having an emergency savings fund to devote to damages is handy, but might not be feasible for your financial situation. Understanding how you can navigate these situations is going to give you the upper-hand.
Be prepared to pay contractors, repairmen, and appraisers for their handiwork if you're planning to repair the property prior to sale. They're not cheap, but they may be necessary to ensure the labor is done to code and as efficiently as possible. Plus, repairing your property and renovating it to a high standard should result in higher offers when you put it on the market.
If you depend on the rent as a source of financial stability or income, then you might be motivated to address the repairs yourself. While this is a viable option to consider, it can also lead to costly expenses and sometimes, even more damage. You'll need firm knowledge of building codes, structural codes, and possibly even Homeowners Association (HOA) guidelines. Be wary of your own physical health, too, as there are always risks involved in repairs, particularly when you're new to renovations.
Selling Despite Damage
Not only can property damage to your rental cost a large amount of money, but it can consume a lot of valuable time and energy. So, what do you do with a damaged rental property that someone may or may not want? You sell as-is! Putting your ex-rental on the market without repairing the damage is the easiest route to navigate, and may end up saving you a lot of stress in the long term.
Many buyers simply look at the potential of the property instead of its current state, while others actively seek damaged homes they can renovate and flip for profit. However, while it might be the easiest option, selling your damaged property on the regular market may not yield the sale price or buyers you're hoping for. Instead, there are many companies who will purchase your property fast, damage and all. This allows you to forget the hassle of repairs and reselling. Often, they don't charge fees or commissions either, so you won't be slammed with additional expenses. The choice of whether you use one of these companies or sell traditionally ultimately depends on how much work you're willing to put in, and how important profit is to you.
If you're unable or unwilling to repair the property, selling as-is to a company that'll purchase without repairs might be your only option—especially when serious damage has been done to a home's structural integrity.
Conclusion
When your tenants have damaged your rental property and it's time to sell, there are several options to consider. For significant structural damage, the most viable option may be to consult a third party to purchase your damaged property as-is. However, if you have the inclination to undertake renovations, you may end up making a sizeable profit in the eventual sale. To calculate whether you're best to repair the property first and then sell or put it on the market as-is, gather quotes for the costs to fix it and consult with a real estate professional for an appraisal on the value.