Purchasing an investment poperty can always feel complex, and in the current market, it’s a bit of a wild ride. In Washington’s King and Snohomish counties, the home prices are high, the inventory is low, and there are a lot of people looking to buy. The market moves quickly, and it’s extremely competitive.
That doesn’t necessarily mean you’re at a disadvantage. If you’re ready to purchase an investment property, you can benefit from the following tips and strategies that we know are effective in securing a good deal.
Find a Great Realtor
Your real estate agent is going to help you identify potential property purchases and also assist you in negotiating the best deal. Always work with someone who specializes in working with investors. Maybe you love the Realtor who helped you buy the home you’re living in yourself. They’re probably great at what they do, but if they don’t have experience identifying investment properties and negotiating from that perspective, you could be at a disadvantage. Look for someone who knows the local market and understands that what a buyer wants as an owner/occupant is different from what a buyer needs as an owner/landlord.
Partner With a Property Manager
Why do you need a property manager this early in the game?
Maybe you think of a management company as the resource you hire to lease, manage, and maintain your investment property after it’s on the rental market.
Yes, we’ll do all that, but you can really leverage our expertise by working with property managers even before you buy. When there’s a particular investment property you’re thinking of buying, we can tell you:
- How much rent you’re likely to earn
- What kind of repairs will be needed before it’s ready for the rental market
- How much maintenance will likely cost in the short and long term
- What kind of vacancy time you can expect
- Which tenants would be most interested in the rental home
All of this information puts you in a stronger position when it’s time to negotiate price and terms.
Negotiate With Flexibility
Good negotiations are the result of each party knowing what they want but also agreeing to compromises when necessary. You don’t want to blow the whole deal out of the water over a disagreement over a few hundred dollars.
Start from a position of strength when you’re negotiating, but get a sense of where the sellers are willing to compromise. Then, meet them on the terms that are less important to you. The all-or-nothing mentality will not serve you when you’re trying to buy an investment property.
Know When to Say No
Compromise and flexibility are important. But, there’s also a time to walk away. If your seller is not budging on anything, and you simply cannot afford the asking price or the closing date is way outside of the range you’re willing to consider, you can give yourself permission to walk away and move on. There are other opportunities out there, and the right one will find you.
These are some of the negotiation tips that we find helpful. When you know the market, have a clear understanding of your own investment goals, and you’ve partnered with the right professionals, you’re in a strong position to negotiate the price and terms you want for your next acquisition.
Planning to invest in a rental home? We can help you make the best decisions. Contact us at Real Estate Gladiators. We support investors in Monroe, Issaquah, Bellevue, Everett, Lake Stevens, Kirkland and other cities in and around King and Snohomish counties in Washington State.