When you’re trying to get a good deal on a prospective rental property, you need to ask questions. You need to understand thoroughly the background of the property and motivation for selling so you won’t have any surprises. Here are four rental property buying questions you should know before you start negotiating to buy a rental property – or any property for that matter.
Why do you want to sell? Divorce, separation, increase in family size, death, all can have an impact on the reasons for selling. Find out what their motivation is. If they don’t seem too interested in selling, you could be wasting your time doing research and making offers that won’t be accepted.
How quickly do you want to sell? The answer to this question will give you an idea of how much negotiation may be involved. You could be in luck if they are trying to sell quickly so they can move into another home they just bought.
How long have you owned the house and do you owe anything on it? With this information you have a better idea of whether they will go for a lower than market offer. If they have been in the house for awhile they may have a lot of equity built up. This will make it easier for them to accept an offer that is 15 to 20 percent lower than the asking price. If the sellers need to sell the house for a certain amount just to break even, you will have a harder time getting a lower price.
Do you need a place to stay after the closing. You may have the opportunity to have the sellers as tenants. It works out as a win-win situation. They have sold the house and you have immediate tenants.
The more motivated the seller, the easier it will be to close the deal.