The Do's and Don'ts of Preparing to Sell An Investment Property - Part 2

Last week we dove into important information and obligations you need to know as a  landlord when selling an investment property.



This week, we will cover things that you might not have thought of previously, such as  can I stage my investment property? How can I market it?


 

Staging Your Investment Property

As a landlord, you don’t have the right to stage your tenant’s apartment. You can’t force  your tenant to rearrange their furniture, take down their personal photos or keep it clean.



Of course, how well a property is presented impacts price and how long it takes to sell.  Here are a few strategies to getting cooperation from your tenant:


• You DO have the right to repair anything that isn’t working, give the walls a fresh  coat of paint, change the light fixtures or wash the carpets. 

• In our experience, most tenants are amenable to their landlord sending in a  cleaning service before the property gets listed – who doesn’t want someone  else to clean their home? 

• Having a good relationship with your tenants or allowing your real estate agent to  build a positive relationship with them, will go a long way to helping the sale.  Happy tenants will be more open to de-cluttering and preparing their apartment.  A fast sale is to your tenants’ benefit too.


 

Marketing a Tenanted Property

It can be more difficult to market a tenanted property. 



Depending on your Tenant (ie. if they are messy), photos might work against you.



Tenants are often not very cooperative with open houses, so reaching potential Buyers  can be more difficult.



A good agent will market your home online and will have a pool of investment Buyers  they are working with to overcome some of the marketing challenges of selling a  tenanted property.


 

Showings Requirements for Selling Tenanted Properties

You have a right to show the property to potential Buyers between 8 AM and 8 PM,  provided appropriate notice (24 hours) is given.



While it may not be convenient for a Tenant, it is your right. Don’t let your tenants bully  you into restricted showing times, but always be respectful of the tenant. A cooperative  tenant will go a long way to making the sale happen faster.



The 24-hour notice requirement means that you’ll miss out on last-minute showings, but  with so many investment properties in the GTA, this isn’t unusual.



Ideally, your tenant will leave their apartment during a showing, but again, this isn’t  something that you can require.



We’ve shown properties where hungover tenants stayed in bed during the entire  showing!



A simple request from your tenant might resolve this obstacle.



Note: If your Tenant has provided you with notice that they are leaving, the Ontario  Landlord & Tenant Act requires that the Landlord make reasonable efforts to provide  notice of a showing – but the 24-hour rule does not apply.



 

Other Selling Considerations for Landlords

• If you’re thinking of selling an investment house or multi-unit dwelling soon, don’t  sign new leases. You’ll get a higher price for your house if you are targeting both  investors and end-users who want to live in one of the apartments themselves.  Having a vacant apartment is an attractive feature for many Buyers.

• If you’re NOT thinking of selling soon, increase your rents every year. The  amount of rent your Tenant pays will directly impact the sale price of your house.  Because the lease transfers with the property, a Tenant who is paying below market rent will mean the new owner will take in less income than they would  with a comparable property, and that will make your house less valuable (read:  lower price). Always charge market rent to a new Tenant, and always increase  rents annually by the amount allowed by law.




If you are a landlord and are thinking it’s time to sell your investment property, give me a  call. I’ve helped lots of landlords navigate the process of showing and marketing a  tenanted property. 

Thanks for reading today’s BLOG!!!

Brian Kondo
Sales Representative / Team Leader
The Brian Kondo Real Estate Team
Re/Max Hallmark First Group Realty Ltd.
905-683-7800 office
905-426-7484 direct
brian@briankondo.com
www.BrianKondo.com
www.BrianKondoTeam.com

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