If you own a property in Atlanta, now might be an opportune time to sell. Inventory is low and investment demand is high, which makes sense when you look at real estate market statistics for Atlanta:
- Population, median household incomes, and property values are all on the rise in Atlanta (Data USA).
- Home values in Atlanta have increased by about 273% over the last 10 years, with sellers seizing the opportunity to sell and turn equity into cash (Zillow).
- Rents in metropolitan Atlanta are rising year over year, a trend that every real estate buyer loves to see (Zumper).
Since Atlanta has all the qualities of a seller's market, you may expect to receive several offers when you put your home on the market. However, suppose you want to sell your rental property as quickly as possible for a fair price. In that case, it's crucial to understand all of the alternatives for selling in the greater Atlanta area before going to market.
Your options for selling rental property in Atlanta
There are advantages and disadvantages to selling a rental property while it’s tenant-occupied. Some landlords try to get the tenant out before the lease expires, but make sure you consider things carefully and research 2 essential details:
- Read your current lease to understand your rights and the tenant's obligations. Some agreements allow you to terminate early if you give enough notice. Other times, if a tenant breaks a term of the lease—such as paying rent late—or refusing to pay at all, you may need to pursue eviction.
- To ensure that you follow regulations, check Georgia landlord-tenant laws.
The next step is to decide on your best option for selling your rental property in Atlanta:
1. Sell to your tenant
Instead of attempting to list your property on the multiple listing service (MLS) right away, contact your tenant and see if they're interested in purchasing it. They might be interested if they've been renting for a while.
Make sure your tenant is preapproved for a mortgage and use the appropriate Georgia real estate agreement to protect yourself and them.
2. Pay the tenant to leave early
If your tenant isn't interested in buying, you might be able to persuade them to leave before the lease expires by providing a cash-for-keys incentive.
If they will eventually need to move anyway, agreeing to cover their moving expenses or assisting with their new home's security deposit can persuade them to depart early and allow you enough time to make any needed repairs for listing your vacant property for sale.
3. Wait for the lease to expire
You might need to wait for the lease to run out before selling your property. Of course, you are free to advertise your rental property for sale a few months before the lease is up.
Always give your renter adequate notice prior to showings, and remind them that if they want to receive all of their security deposit back, they must leave the home in good condition when they move out.
4. Sell with the tenant in place
Roofstock is a popular online listing platform for Atlanta property owners who want to sell a rental home. It's simple to market your house while a tenant is living there, and you can save time and money by allowing the tenant to stay until the end of the lease:
- Keep collecting your rental income until the day your deal closes.
- Reach a global network of qualified real estate investors on Roofstock instead of limiting yourself to the local MLS.
- Pay a competitive real estate commission (3% versus the typical 5% to 6%) and keep more of your hard-earned money.
- Research the Roofstock Marketplace to see what other rental properties in Atlanta are selling for and stay ahead of the competition.
What you should do before selling rental property
Before going to market, there are a few things you can do to get the most profit out of your rental property in Atlanta:
- Compile a buyer package of essential documents, including a copy of the lease and tenant rent roll, financial reports such as a profit and loss (P&L) statement, a list of vendors and maintenance history, and a rundown of any significant building repairs or improvements completed in the previous several years.
- Buyers like to purchase a house in good working order, so have an expert property inspection done and make any required repairs ahead of time so that the buyer doesn't try to negotiate for a lower purchase price.
- Tell your renters that the home is for sale, and explain what showings will be like and how the transfer of their existing lease and security deposit to the new owner will work.
- Calculate your potential capital gains tax liability and research doing a 1031 tax-deferred exchange to delay paying taxes by purchasing a replacement investment property in the United States.
How to price your investment property for sale in Atlanta
In Atlanta, pricing your rental property for sale is a delicate balance of art and science. You must establish a reasonable asking price per square foot, yet you also want to emphasize the financial success of your home in order to obtain a quick closing at an excellent price:
- Calculate the cap rate by dividing the net operating income (NOI) by the asking price, then compare it to similar properties for sale in your area to ensure you're fairly priced.
- Cash-on-cash return can be used to help buyers evaluate how much money their down payment would produce at today’s interest rates.
- Determine the after repair value (ARV) of your home if you can't afford to make all of the needed repairs so that purchasers understand the increased equity they'll have once maintenance is completed.
When everything is said and done, selling your rental property in Atlanta the right way could result in a fast sale at a good price. To get started, get a free price estimate and consultation for your Atlanta rental property.