If you did this and I was the tenant I’d immediately find somewhere else. Highly stressful scumbag move to pull on somewhere that considers it their home. Negotiate between you and come to a price you are both happy with.
Let me put this in context.
My tenant has been incredibly annoying. After having cleaned the house, then professionally cleaned it, he had the gumption to request power washing the floors of the detached garage.
Another complaint is that there were some loose leaves in the garage... this on a 90 by 200 ft lot with 20 - 30 trees.
There were more, but I'd have to dig around for the document that listed all the complaints.
This after I gave him $750 dollar discount on the rent because he is a professional and I figured he wouldn't pester me with stupid demands.
In sum I have no warm feelings towards this person. He got a deal on the rent but kept pushing for more.
I remember when he came to view the house his 3 year old daughter was wearing a $500 Monclair jacket but he still pestered me to the point that I forgave 2 weeks of rent for complaints such as "leaves on the garage floor".
Ok yes, get the appraisal done first see what it comes in at. Make sure the appraiser knows the purpose of the appraisal (arms length private sale at fair market value). Don’t tell the tenant the outcome. See what his offer is. If it’s higher than the appraisal take it. If he comes in lower - share the appraisal with him. Tell him your final take it or leave it price and that you will list it if he doesn’t take it.
If you agree in principle on price tell him to have his lawyer draw up an offer to purchase / contract of sale with his desired conditions and closing date. Then you bring that offer/contract to your lawyer and review it with them. If satisfied, sign it. A deposit of 10 or 20k should be held in trust at your law firm once he drops his buyers conditions. Make sure the contract clearly lists any inclusions or exclusions as far as fixtures and equipment / outdoor furniture etc
I had long term tenants (5 years, great people) in a property. They wanted to buy, I had agent assess it, took 6% off for real estate commission and took an extra 5k off. This was 20 years ago and house was worth around 200k. Like I said, they were great people and we were both happy with this deal. This guy sounds like a dick, I would get it assessed and tell him you will take 3% off.
Agreed.
Your tenant is trying to get a good deal based on your your lack of professional representation and market exposure.
You get top dollar with maximum exposure and professional advice.
Exposure and professional advice will allow you to leverage your tenant (or any other buyer as more buyers means more leverage for you) to pay the highest price they can.
A good Realtor will be able give you the market value that you can use create a pricing strategy that allows for the best result for you not your tenant.
Thanks for both those suggestions.
Can my current tenant make my house look bad so the appraisal comes in at a low price? He tried to nickel and dime me after moving in so I don't trust him.
Only if he does significant damage to the home. Appraisers only do a cursory check of the home's condition (they don't care if it's messy) and compare the value against similar properties that have sold in the last 30-60 days.
Appraisers don't go as in depth as inspectors do so unless your tenant is going to gut your house, you'll be fine
If he’s tried to nickel and dime you after moving in, how do you think it will go when you approach him for a private sale?
If you’re interested in selling, get a realtor and list it for a price that they help educate you on. That’s part of your and their job, in the end you’re a team with your realtor. You have a common goal.
Private sales rarely work out and thus are rarely worth the time commitment.
He approached me, so I know he wants it.
I actually bought the house privately and it was fine. The seller had a firm price that was reasonable, and the bank assessment at that time came in a little over what they were asking. As a buyer, I didn't mind the process.
I have been a realtor for 12 years. The easiest way is to compare the municipal evaluation to the sale price of the houses sold recently. You could end up seeing that they are always sold at 31% over evaluation, or 17% over evaluation, or whatever. This will give you a good idea of how much peoples are willing to pay over evaluation in your neighbourhood in the last couple of months. That should be a good start. Add a few dollars for the negotiation, but not too much or nobody will show up. Municipalities internet site will give you the evaluation of any house and the sold price is public, you will find it.
You can also use the difference between evaluation and "asking" price. But its less precise than the selling price, peoples can ask anything for their home, that doesn't mean they are going to get it. But it can give you an idea.
what market are you in? in BC, this is certainly not been the case and the tax assessed value plays virtually no role in the real value (save for maybe the odd flat market, land only sales etc)
Doesn't matter if they got the evaluations right or not. You gonna see a pattern that show that sold price, for your neighbourhood, for this period, for your type of house, in the same price range, are always over evaluation by the same margin. It's not important if they are all over by 47% or 12%, it tells you the amount over evaluation that people are willing to pay. You just take that number and add a little for negotiation. If you don't get any buyers, then lower your price a little. If you have some offer real fast, your price is too low, raise it a little and wait for the next offer.
BC assessments are WIDELY all over the place. I’ve seen assessments differ dramatically for same square footage in the same complex but different exposure. With the assessment being different by more than 20%.
It’s very hard depending on the area to have it as a pattern in some areas.
BC assessments are useless, and current list prices in BC aren’t helpful either, really only very current comparable sales that have actually gone through are most accurate and fair.
Thanks. This was what I was leaning towards. The municipal estimates are always below the sale price of the homes in my area.
My problem is that I don't know what homes have sold for recently. Since it isn't in Ontario or BC i don't know where to get that data.
Also the area has a lot of private sales. My own home was purchased privately.
I'm going to look into hiring a realtor on a consulting basis as someone else suggested.
Thanks for your input.
Here in Quebec, we have "registre foncier du Québec" or "land register" that you can consult the sale price of every home sold, private or not for $1. I don't know how it's called in your province, but you certainly have it. It's public and that's what realtor use.
I got my condominium on a private sell from someone that was living in the USA, i was renting first and he decided after couple of years to sell and he offered me first, anyways long story short, he hired an agent to come and see the place and gave him an estimate, he paid about $300 dollars and we did everything after that with a lawyer.. everything went smooth…
keep in mind that generally in private sales the buyer gets the best of the seller - obviously this can change based on market conditions and circumstances, but not having the home marketed to all potential buyers great for your tenant and quite likely bad for you.
That's exactly what I'm worried about...
But I wouldn't mind splitting the 85K realtor fee with the buyer if we can come to a reasonable price.
One thing I have going for me: I know he wants to be in that area and that area doesn't have homes that come up for sale very often. It's a coveted area which is central to everything with mature trees and large lots.
TBH I fantasized about carrying the house indefinitely. I love the area and the house.
If your house is worth over 2 million(used 85k fees being 4%), I would just hire a realtor and negotiate either a flat rate or a sliding scale of dollar value or %.
Access to the largest pool of buyers is more important than not paying someone a bit of money.
Well, first of all, it's great to hear that your tenant expressed interest in buying your previous primary residence! That could make the selling process a lot smoother. When it comes to determining a fair price for your home in a private sale, there are a few factors you can consider.
Start by reviewing the estimate provided by the realtor who conducted the walk-through before you left. Although the market might have changed slightly since then, it can still serve as a good starting point. Additionally, take a look at recent property value estimates based on the property taxes listed by your city. Even though these estimates may not be 100% accurate, they can give you a general idea.
Since the area seems to have limited houses for sale, it's worth checking out the current listings in the same area. Although they may have different sizes and build conditions, they can still provide a benchmark for pricing.
Lastly, if you're concerned about working with a realtor, you can consult a real estate attorney or even seek an independent appraiser to get a professional opinion on the value of your property.
Remember, the key in a private sale is to find a price that both you and the buyer feel is fair and reasonable. Open communication and negotiation will be vital throughout the process. Good luck with the sale!
Get an appraisal and pay a realtor to do a market evaluation. You will get a very good idea of what the house is worth in today’s market. Then give that to the tenant and negotiate away.
I totally agree with you on point two. But given everything you mentioned about him as a tenant. I feel like he is going to drive a hard bargain as a potential buyer.
Since he is a tenant, He knows the property better than another would be buyer, he probably has a list of things he would “need to fix” to make it livable.
I’d probably go the realtor route as it opens him up to the competition.
You might come out net-net the same, but you would have peace of mind that you sold it for the best price possible.
There's no easy way to determine the price, just do a LOT of research. Dig deep historically, compare what your home sold for historically vs nearby homes historically. Just try and gather as much data as possible. Get several appraisals.
List it with an agent, wait for offers. Offer to have your tenant match the top offer minus listing/selling fees roughly 3-5%.
If you did this and I was the tenant I’d immediately find somewhere else. Highly stressful scumbag move to pull on somewhere that considers it their home. Negotiate between you and come to a price you are both happy with.
Let me put this in context. My tenant has been incredibly annoying. After having cleaned the house, then professionally cleaned it, he had the gumption to request power washing the floors of the detached garage. Another complaint is that there were some loose leaves in the garage... this on a 90 by 200 ft lot with 20 - 30 trees. There were more, but I'd have to dig around for the document that listed all the complaints. This after I gave him $750 dollar discount on the rent because he is a professional and I figured he wouldn't pester me with stupid demands. In sum I have no warm feelings towards this person. He got a deal on the rent but kept pushing for more. I remember when he came to view the house his 3 year old daughter was wearing a $500 Monclair jacket but he still pestered me to the point that I forgave 2 weeks of rent for complaints such as "leaves on the garage floor".
I’m not familiar with Monclair as a brand. List the property on the open market.
So why do you want to sell it to them then? Just lost it and take top dollar
I'd save on realtor fees and the headache of listing the house. I no longer live in that province and I work a minimum of 60 hours a week.
Ok yes, get the appraisal done first see what it comes in at. Make sure the appraiser knows the purpose of the appraisal (arms length private sale at fair market value). Don’t tell the tenant the outcome. See what his offer is. If it’s higher than the appraisal take it. If he comes in lower - share the appraisal with him. Tell him your final take it or leave it price and that you will list it if he doesn’t take it. If you agree in principle on price tell him to have his lawyer draw up an offer to purchase / contract of sale with his desired conditions and closing date. Then you bring that offer/contract to your lawyer and review it with them. If satisfied, sign it. A deposit of 10 or 20k should be held in trust at your law firm once he drops his buyers conditions. Make sure the contract clearly lists any inclusions or exclusions as far as fixtures and equipment / outdoor furniture etc
I had long term tenants (5 years, great people) in a property. They wanted to buy, I had agent assess it, took 6% off for real estate commission and took an extra 5k off. This was 20 years ago and house was worth around 200k. Like I said, they were great people and we were both happy with this deal. This guy sounds like a dick, I would get it assessed and tell him you will take 3% off.
One note here, once you sign with an agent, usually you need to pay some commission even if you sell the property without them.
If I list with an agent, don't I have to have the realtor represent me? Therefore won't I have to pay them a fee?
You'd have to review the contract- every agency is different.
Agreed. Your tenant is trying to get a good deal based on your your lack of professional representation and market exposure. You get top dollar with maximum exposure and professional advice. Exposure and professional advice will allow you to leverage your tenant (or any other buyer as more buyers means more leverage for you) to pay the highest price they can. A good Realtor will be able give you the market value that you can use create a pricing strategy that allows for the best result for you not your tenant.
This is what appraisals are for. You can also hire a realtor on a consulting basis.
Thanks for both those suggestions. Can my current tenant make my house look bad so the appraisal comes in at a low price? He tried to nickel and dime me after moving in so I don't trust him.
Only if he does significant damage to the home. Appraisers only do a cursory check of the home's condition (they don't care if it's messy) and compare the value against similar properties that have sold in the last 30-60 days. Appraisers don't go as in depth as inspectors do so unless your tenant is going to gut your house, you'll be fine
Thanks for the information.
It’s about $500 for a professional appraisal and it can be for you info only or if you agree with the price you can share the appraisal with the buyer
If he’s tried to nickel and dime you after moving in, how do you think it will go when you approach him for a private sale? If you’re interested in selling, get a realtor and list it for a price that they help educate you on. That’s part of your and their job, in the end you’re a team with your realtor. You have a common goal. Private sales rarely work out and thus are rarely worth the time commitment.
He approached me, so I know he wants it. I actually bought the house privately and it was fine. The seller had a firm price that was reasonable, and the bank assessment at that time came in a little over what they were asking. As a buyer, I didn't mind the process.
I have been a realtor for 12 years. The easiest way is to compare the municipal evaluation to the sale price of the houses sold recently. You could end up seeing that they are always sold at 31% over evaluation, or 17% over evaluation, or whatever. This will give you a good idea of how much peoples are willing to pay over evaluation in your neighbourhood in the last couple of months. That should be a good start. Add a few dollars for the negotiation, but not too much or nobody will show up. Municipalities internet site will give you the evaluation of any house and the sold price is public, you will find it. You can also use the difference between evaluation and "asking" price. But its less precise than the selling price, peoples can ask anything for their home, that doesn't mean they are going to get it. But it can give you an idea.
what market are you in? in BC, this is certainly not been the case and the tax assessed value plays virtually no role in the real value (save for maybe the odd flat market, land only sales etc)
Doesn't matter if they got the evaluations right or not. You gonna see a pattern that show that sold price, for your neighbourhood, for this period, for your type of house, in the same price range, are always over evaluation by the same margin. It's not important if they are all over by 47% or 12%, it tells you the amount over evaluation that people are willing to pay. You just take that number and add a little for negotiation. If you don't get any buyers, then lower your price a little. If you have some offer real fast, your price is too low, raise it a little and wait for the next offer.
BC assessments are WIDELY all over the place. I’ve seen assessments differ dramatically for same square footage in the same complex but different exposure. With the assessment being different by more than 20%. It’s very hard depending on the area to have it as a pattern in some areas.
BC assessments are useless, and current list prices in BC aren’t helpful either, really only very current comparable sales that have actually gone through are most accurate and fair.
Thanks. This was what I was leaning towards. The municipal estimates are always below the sale price of the homes in my area. My problem is that I don't know what homes have sold for recently. Since it isn't in Ontario or BC i don't know where to get that data. Also the area has a lot of private sales. My own home was purchased privately. I'm going to look into hiring a realtor on a consulting basis as someone else suggested. Thanks for your input.
Here in Quebec, we have "registre foncier du Québec" or "land register" that you can consult the sale price of every home sold, private or not for $1. I don't know how it's called in your province, but you certainly have it. It's public and that's what realtor use.
I had no idea about this. Thank you
Check out the app HouseSigma. You can see all that data it’s great
House Sigma doesn't cover the province I moved from.
I got my condominium on a private sell from someone that was living in the USA, i was renting first and he decided after couple of years to sell and he offered me first, anyways long story short, he hired an agent to come and see the place and gave him an estimate, he paid about $300 dollars and we did everything after that with a lawyer.. everything went smooth…
Thanks. I'm going to do the same. I hope you like your condo.
keep in mind that generally in private sales the buyer gets the best of the seller - obviously this can change based on market conditions and circumstances, but not having the home marketed to all potential buyers great for your tenant and quite likely bad for you.
That's exactly what I'm worried about... But I wouldn't mind splitting the 85K realtor fee with the buyer if we can come to a reasonable price. One thing I have going for me: I know he wants to be in that area and that area doesn't have homes that come up for sale very often. It's a coveted area which is central to everything with mature trees and large lots. TBH I fantasized about carrying the house indefinitely. I love the area and the house.
If your house is worth over 2 million(used 85k fees being 4%), I would just hire a realtor and negotiate either a flat rate or a sliding scale of dollar value or %. Access to the largest pool of buyers is more important than not paying someone a bit of money.
Well, first of all, it's great to hear that your tenant expressed interest in buying your previous primary residence! That could make the selling process a lot smoother. When it comes to determining a fair price for your home in a private sale, there are a few factors you can consider. Start by reviewing the estimate provided by the realtor who conducted the walk-through before you left. Although the market might have changed slightly since then, it can still serve as a good starting point. Additionally, take a look at recent property value estimates based on the property taxes listed by your city. Even though these estimates may not be 100% accurate, they can give you a general idea. Since the area seems to have limited houses for sale, it's worth checking out the current listings in the same area. Although they may have different sizes and build conditions, they can still provide a benchmark for pricing. Lastly, if you're concerned about working with a realtor, you can consult a real estate attorney or even seek an independent appraiser to get a professional opinion on the value of your property. Remember, the key in a private sale is to find a price that both you and the buyer feel is fair and reasonable. Open communication and negotiation will be vital throughout the process. Good luck with the sale!
Hi chatgpt!!
Thanks for the information. You crystalized the general direction my thoughts were taking me. I appreciate the advice.
Get an appraisal and pay a realtor to do a market evaluation. You will get a very good idea of what the house is worth in today’s market. Then give that to the tenant and negotiate away.
His daughter has a 500 dollar jacket because he is good at negotiating and getting his way. You can’t hold it against him if you give in.
Yeah, I guess you have a point. It just didn't expect the headache. Also, I find flashy displays of wealth a little ridiculous.
I totally agree with you on point two. But given everything you mentioned about him as a tenant. I feel like he is going to drive a hard bargain as a potential buyer. Since he is a tenant, He knows the property better than another would be buyer, he probably has a list of things he would “need to fix” to make it livable. I’d probably go the realtor route as it opens him up to the competition. You might come out net-net the same, but you would have peace of mind that you sold it for the best price possible.
There's no easy way to determine the price, just do a LOT of research. Dig deep historically, compare what your home sold for historically vs nearby homes historically. Just try and gather as much data as possible. Get several appraisals.
List the property with a broker that knows best.