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PROAPOD
®Real Estate Investment Softwarewww.proapod.com
How to Sell Your First Rental property
 James R Kobzeff 
Once you make the decision to sell rental property, you cross the largest obstacle between you andclosing your first income property deal: The desire to sell more than residential real estate isforemost.In this article, I'll show you four things you must now do that will help you seize every opportunity, perhaps avoid missed opportunities, and maybe bypass months (perhaps years) of trial and error  before you close and subsequently collect your first rental property sales commission. It's notexhaustive, but guaranteed to get you started on the right foot.1. Learn some basic terms and formulas. After numerous years of assisting countless residentialreal estate agents in a large real estate brokerage frantic for rental property advice, I stronglyrecommend that you understand just two real-estate-investing-related terms (and/or formulas) inthe beginning. Comprehension of other terms and formulas can wait and follow later.a) APOD – An APOD is a report that shows the income, expense, and cash flow of an investment property for the future first year of the property's operation. It's an assumption because it's basedupon current property data subject to change; still, it does offer a valuable indication of how a property will perform after one year of ownership. APOD is an acronym for Annual PropertyOperating Data (in case you're wondering). b) Cap Rate – Understanding how cap rate (or capitalization rate) is calculated is likewise paramount to working with rental income property. You will not mingle in real estate investingcircles very long without hearing about or seeing a cap rate. I'll forego the textbook definition andcut to the chase: here's the calculation (memorize it): Net Operating Income (NOI) divided by Sale Price = Cap Rate2. Determine what typical cap rates are in you local market. Conduct your own comparative marketstudy.Start with your local MLS. What cap rates are income-producing properties listed and/or sold? Caprates are commonly included in rental property listings so it shouldn't be difficult. If cap rates arenot shown then make the calculation yourself (you only need the property's net operating incomeand sale price). If the NOI isn't shown then derive one by computing the gross income anddeducting about 45% for vacancy allowance and operating expenses. If the gross income isn'tshown, then call the listing agent or scrub it and move on to the next property.
©2009 James R Kobzeff. All rights reserved.
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