A Great Result For A Great Tenant!
So a friend asked me to look into selling his home and as I'm going through it and did the appraisal on the property, I had to go and actually meet the tenant. First things first, be super great to tenants because they're paying your mortgage. If they are wonderful people treat them like absolute gold. Fix everything, don't delay. Get it done.
Asking questions and knowledge about finances.
Anyway, the point is I went around to do the appraisal on the property and I just sort of noticed that the tenant was quite settled. Really well presented, interests in every room, set up properly. And I love asking the questions, like who are you? What do you do? How do you do it? Why do you rent? So anyway, I then asked the question and said do you really enjoy living here? What's it like? And she goes, "Yeah, I love it." I said, "Cool, so what's your story? Do you want to stay, do you want to go? Where are you at?"
What came up during the conversation is that she is renting the place because of the sale of her home about two years ago. She has a large amount of money sitting aside in an account, and she's paying this rent which is pretty decent rent for a property. And this is just knowing your numbers a little bit better than the average - every agent must have an understanding of what's going on with finance. An agent must have an understanding of how that relates to buying and borrowing money from a rental position at the moment, because sometimes it's cheaper to buy than it is to actually go and rent, depending on the physicality of the person.
Renting versus owning.
So I learned by asking that she loves the home, so I thought you know, I'll just throw a couple of ideas out there. I said, "Have you owned property before?" And she goes, "Yes, I have, and I've sold about two or three and I've been renting for about a year and a half." And I said, "Look, this home is probably going to be coming up in the marketplace.
Have you considered what the numbers look like from a matter of ownership? And if you've got some equity sitting in the bank that you're happy to drop into some level of an offset, I think you might be able to find that you could drastically reduce your cost per week to living in this property." She goes, "You know what, I haven't really even thought about it. Would you mind me doing some general numbers right now?"
Now, we have a brokering firm that works closely with us and what you can see from how this unfolded is that it’s super important that you have a relationship with brokers so that you can double check numbers and you've got someone to refer to directly. So basically by the end of the conversation, we had sat there and we figured out we could save her $150 per week, and she would gain the ownership of the home she’s currently renting. She would be saving money on a yearly basis, which is more money back in her property from an equitable position, or an ownership point of view.
The end result.
I asked the tenant - would you be interested in buying the property that you're currently living in if you're so happy being here right now? Literally took me about three days to pull the whole deal together. She wanted to be there, so it’s basically a done deal. Not too hard when doing the physical buyer's inspection, because she lives there in the house itself. Building and repairs are being done, and it’s simply a matter of asking one more question. Opportunities exist in every situation provided that we are open and okay to go and ask a question.
I hope that story helped you with figuring out your own plans for selling or buying. Have fun, and see you at the opens!