Detroit, MI · Member since 2012 · 170 posts · 21 votes
We've found that most of the landlord owners that we deal with don't want us to let their tenant know that they're trying to sell the house for obvious reasons.
They tell us to tell the tenants that we're insurance agents, and the whole nine, to keep from alarming the tenants.
This can become an issue, as with each subsequent time that we have to show up at the property for a showing, the tenant gets more and more suspicious...
Either that, or they get increasingly more and more harder to work with to schedule showings, etc.
What do you do to make things go at least as smooth as possible in these situations?
Is there any effective way to offer an incentive to both the current owner/landlord and the tenant (or one or the other is fine, as well)?
Investor · Riverside, CA · Member since 2011 · 2k+ posts · 3k+ votes
13y
Well, if you're wholesaling, tell your buyers they bought what you bought. No need to look inside. Move along please. Only serious buyers with cash please step forward.
How many properties do you think trustee sale buyers get to see inside of before they bid on them down at the court house steps? My educated guess (and having purchased property at the court house before) is somewhere close to donut hole.
Maybe you need to walk your deals down to the local court house steps and start selling to the real buyers. If people need to see the inside, then you aren't really wholesaling properties. You are trying to get landlord buyers to pay slightly below market price for a property with a tenant in place. Trustee sale buyers don't care about the tenant. They kick out former home owners all day long. Just the nature of the business. If they aren't interested in your deals, become a better buyer, stop paying so much, and get them interested.
Real Estate Agent · Henderson, NV · Member since 2011 · 1k+ posts · 550 votes
13y
I typically market tenant occupied properties with showings upon accepted offer only. I've also found that it's easier to be up front with the tenants from the start. Walk them through the process. You could even talk the landlord into offering a slight rent reduction until it's closed as compensation for the hassle.
Investor · Riverside, CA · Member since 2011 · 2k+ posts · 3k+ votes
13y
What do you mean "each subsequent time that we have to show up at the property for a showing?"
How many times do you need to see a property before you sell it? Your post title says 'flipping' so I'm curious exactly what you are doing? Flipping typically refers to fixing up and selling. Why don't you just kick the tenants out?
I buy lots of properties and wholesale them without ever even seeing the property, never mind going inside and walking around some stinkin' tenant's mess.
I budget for a typical rehab regardless of what condition the owners says it's in. Even new homes have problems so a property occupied by a tenant and more than 10 years old is going to definitely need some work and updating.
Investor · Riverside, CA · Member since 2011 · 2k+ posts · 3k+ votes
13y
Well, if you're wholesaling, tell your buyers they bought what you bought. No need to look inside. Move along please. Only serious buyers with cash please step forward.
How many properties do you think trustee sale buyers get to see inside of before they bid on them down at the court house steps? My educated guess (and having purchased property at the court house before) is somewhere close to donut hole.
Maybe you need to walk your deals down to the local court house steps and start selling to the real buyers. If people need to see the inside, then you aren't really wholesaling properties. You are trying to get landlord buyers to pay slightly below market price for a property with a tenant in place. Trustee sale buyers don't care about the tenant. They kick out former home owners all day long. Just the nature of the business. If they aren't interested in your deals, become a better buyer, stop paying so much, and get them interested.
Developer · Santa Clarita, CA · Member since 2008 · 15k+ posts · 10k+ votes
13y
Alvin, I don't believe being dishonest is the best path so I would suggest you look at stopping the "insurance inspection" excuse. Phillip gave you the best answer. Nobody gets to see the inside until the contract is signed. Since you are selling a tenant occupied property, you are likely selling to an investor and thus, they should be accustom to contracting with subject to interior inspection. Once under contract, you arrange for the one and only showing explaining to the tenant that a new owner will be buying.
Detroit, MI · Member since 2012 · 170 posts · 21 votes
13y
Originally posted by Aaron Mazzrillo:
If people need to see the inside, then you aren't really wholesaling properties. You are trying to get landlord buyers to pay slightly below market price for a property with a tenant in place.
How so? It's up to the new buyer whether or not they keep the tenant in there, I don't really care whether they do or they don't.
The tenant is someone I've been having to deal with when we're showing the property to prospective buyers.
Real Estate Investor · Buzzards Bay (Bourne), MA · Member since 2012 · 208 posts · 28 votes
13y
I agree with Phillip and Will & just put the inspection clause in once and offer is accepted. No need to go through all that hassle. I also don't like using the insurance agent ploy.