What to do BEFORE you sell your rental property.

1. Talk to your property manager. You will need to know details of tenancy agreements including the expiry of any fixed term agreements, and what your rights and responsibilities are, including accessing the property for showing it to potential purchasers. Your tenants have a right by law to know the property is on the market, and the property manager is the correct person to tell them. Your tenants may want to purchase the property, which could save you sales commission and make it an easy process. Or other clients of your property manager may be looking to buy your property - ask. Your property manager can also recommend some sales people who may be able to sell your property with the least amount of disruption to your tenants. You want to keep your tenants on board throughout the process because if it doesn’t sell, you will need to live with the consequences. A tenant can make or break a sale with how they keep the property during the process. A good property manager will spell out to them that they are being evaluated along with the property – a new landlord won’t want to keep messy and difficult tenants.

2. Talk to your bank. Your lender may have some strong opinions about you selling a property. Make sure you can close the deal without losing your own house too. This is particularly important if you have a high mortgage on this or any other property.

3. Talk to your accountant. There can be some advantages to carefully timing your sale to fall into one or another tax year. Better to ask early than regret later. They may also have some strategies for avoiding the need to sell at all, or for dealing with GST, depreciation clawback, or capital gain issues.

4. Get the paperwork together, such as tenancy agreements, rental assessments, comparative market analysis, valuations, building report, LIM report, etc for the buyers to view. Having these documents on hand will make your salespersons job easier, the buyers happier, and your sale more likely to go swiftly and easily.

5. Choose the right salesperson. It is not necessarily the one who sold you the property. Some salespeople are better at selling family homes, others better at investment properties. Make sure they know your area well, have a large database of contacts, and good marketing strategies. Don’t just go for the one who names the highest price – they may just be angling for your listing. Have them back it up with comparable sales data for your area.

6. Be clear about how long the property will be on the market, and have a plan B if you don’t get an offer you are happy with. Remember, the market will decide what price you get, you decide what you do with that.

7. Decide which improvements you will do to assist the sales process, and which you will defer. Anything which improves the presentation of the property is usually a winner with buyers. Don’t put off maintenance – less and less people want a ‘doer-upper’ and a negative building report could cost you a sale.

8. Invest in great photos. A picture paints a thousand words. Have yours say ‘desirable’. Make sure you own the rights to the photos – if you don’t sell, you can use them for advertising when it is for rent.

9. Keep good tenants in the property during the process. If you are not worried about paying the mortgage you can wait for the best possible offer. Good tenants make a property look homely with nice furniture, and many tell prospective purchasers what they love about the property. Bad tenants are a whole other matter…

10. Keep your property manager in the loop. They can help in so many ways, so treat them as partners in the process. They can be very helpful for testifying to the rent-ability of the property, rental assessments, and apportioning the rent on settlement and a well-managed property is easier to sell than a badly-run one.