An Agent’s Guide to Selling Distressed Properties
For real estate agents, selling distressed properties can be quite a tricky process. If your sellers are struggling to avoid foreclosure, are behind on mortgage payments, or dealing with bad tenants; they need a realtor who can get them a deal as quickly as possible. It’s your job to help your sellers every step of the way, and you’re likely to run into a few obstacles along that journey.
Suppose you’re in the pre-listing phase of a distressed property sale. In that case, you’ll want to consider a few different factors that go into the sales process, including repairs, price, multiple listing services (MLS), and timeline. Though it may sound daunting, agents selling distressed homes can still find massive success by using the right strategies.
When it comes to distressed property sales, we’re experts on what it takes to find deals that make your sellers happy. Here are our real estate agent tips for distressed sales.
1. Find out what your seller needs
Most of the time, homeowners are selling their distressed properties because of a problematic situation. Maybe your client’s property has fallen into disrepair, or they inherited the property from a deceased family member. Other distressed property sellers could be facing foreclosure and may want to find a cash buyer. Either way, their agent should empathize and be willing to understand their needs fully.
2. Set clear expectations
In February 2021, home sales were up 23% from the year prior, so it’s a great time to take on more listings. However, you’ll want to be clear with your client about the realities of their sale. By definition, distressed properties require more repairs and initial investment, so your buyer pool will likely be smaller, and your realistic selling price will be a bit lower (compared to a renovated property). Ensure your seller is aware of the market and try to advise against full-price listings on an MLS.
3. Determine a realistic timeframe
How quickly does your client need to sell? For those who are avoiding foreclosure, short sales are essential. Configure a realistic timeline with your client as soon as possible to gauge your next steps.
For faster sales, talk about how to get a cash offer. For sellers with more flexibility, consider taking time to do some simple repairs and comb through your network to find an interested buyer.
4. Be open and honest with interested buyers
A distressed property buyer is looking for facts and specifics. The home you’re selling will probably attract house flippers and iBuyer companies looking for an investment opportunity, so you don’t need to sugarcoat the sale.
Be honest about the home’s current state and talk about its potential. Maybe it’s in a great location or an up-and-coming neighborhood. Try to speak to the property’s strengths and be honest about its weaknesses.
5. Don’t be pushy
Even if your seller is on a tight timeline, don’t be pushy with buyers. Pushiness can make buyers suspicious about the means of your sale. Always be available to answer questions and make sure your sellers are comfortable, too.
Of course, you want to encourage your sellers to make the smartest sale possible, but you don’t want to leave their property on the market for too long. Don’t push your sellers to make a sale they don’t feel comfortable with either.
6. Build relationships with real estate investors
Realtors with an extensive network of real estate investors (REI) or developers are likely to see the most success in selling distressed properties. In 2020, the number of flipped houses reached a 14-year high, likely related to the do-it-yourself boom during the early COVID-19 shutdowns. When you build relationships with REI companies, you can contact them first before listing a property on an MLS. Develop trusted relationships with REI contacts that will perform for your clients and make your job easier.
7. Sell the home for cash
Agents can face unbelievably tricky sales. Blueprint Homes can help both you and your seller reach a solution that makes everyone happy. We will take rigid, distressed properties off your hands before they’re listed, with a cash offer that speeds up the sale process and makes your sellers happy. Agents who send their clients to us also have the opportunity to work a triple-ended deal, acting as the seller’s agent and buyer’s agent in the initial sale, with the chance to represent our resale.
Listing on an MLS might get you a higher selling price, but you run the risk of a painstaking selling process that could last months. Blueprint Homes trades dollars for convenience; we focus on transparency and a willingness to help our sellers as much as possible. Our cash offers come with no obligation. If your clients aren’t ready to commit to us, test the market. We’ll stand by our offer, regardless.
8. Don’t push a sale that isn’t happening
If your client is getting cold feet, there is no problem with testing the market. In this case, you’ll want to work with a flexible buyer. We know that these sales can be complex, so you need to find the buyers who will honor their offer no matter how long it takes to get there. You may be surprised at the value you can get for your off-market listing.
Learn More About Working With Blueprint
For those interested in learning more about how we can help property owners and agents with distressed property listings, set up an initial consultation. You’ll find our commission model and quick turnaround time benefits both agent and seller.