When is the Right Time to Sell Your Multifamily Investment?

February 15, 2018 | Blog

Timing is (almost) Everything When it Comes to Selling Your Apartment Building

     Perhaps you are making changes to your business strategy, or you’re looking to make a new, bigger investment opportunity. Whatever your reasons for deciding to sell your multifamily property, keep reading: you’ll learn the best time to put your asset on the market, and how to maximize the all-important return on investment.

Time the Market

    When it comes to selling any kind of real estate, timing is key. And while the market is notoriously hard to predict, there are signs you can look out for to help you decide when to sell. As well as making sure your property is operating at peak performance, it’s important to know where you are in the real estate cycle as a whole.
    One of the major indicators that the market has shifted from a buyer’s market to a seller’s market is when existing properties begin to sell for more than the replacement cost. While there will likely never be a huge divergence between existing property cost and replacement property cost, this indicator presents a good opportunity that you can take advantage of.

Have Everything in Place

    Since multifamily properties are purchased as investments, being fully prepared before the sale is critical. Make sure your asset is in top condition: now’s the time to resolve any nagging maintenance issues, and pay attention to the first impression that your property gives. To help with the sale, you might also consider making some capital improvements.
    When it’s time to sell, you must have a due diligence package available for prospective buyers. Be sure to include lease agreements, rent rates, and all of the other pertinent information your buyer needs to make an offer on your asset.

Price Your Property Right

     When you’re looking to sell an apartment building, choosing the right price is essential. Make sure you ask for the right amount by conducting a thorough comparable sales analysis. When you analyze the submarket, property condition and cap rate of recent sales activity you will quickly see how your property stands up. Learn more about how to conduct a comparable sales analysis in our investor insights video.
    It’s crucial to avoid overpricing — the longer your property sits on the market, the less attractive it will appear to prospective buyers. Working with an experienced multifamily investment advisor can help you choose the right price.

Know the Rules

    Before selling your multifamily property, make sure everything is in order. Not being aware of the rules, regulations, and local laws can be a time-consuming — and costly — mistake to put right. Consider working with an advisor who has proven expertise working with multifamily sellers and an in-depth knowledge of the local real estate market.
    Choosing the right broker can also have a big impact on the speed, smoothness and final value of your transaction. A multifamily investment advisor can act as a professional liaison between you and potential buyers, and they’ll work with you to build a strategy to get the maximum value for your property.
    So, when is the best time to bring your multifamily investment to market? Knowing the perfect time to sell is not an exact science, but with research and proper planning you can use market indicators to help you identify opportunities to maximize your return on investment.

    Put yourself in the best selling position possible, with a trusted multifamily investment advisor by your side. The team at 100Units.com has helped thousands of clients close more than $100 million in multifamily property transactions. We take the time to evaluate your investment goals to help you attain the long-term success and results you want. You can learn more about us here.

    Have you read our other articles specifically for multifamily sellers? Our blog is packed with expert advice on how you can maximize your return on investment. For even more investor insights as well as new property tours, visit our YouTube channel.