Owning and managing an apartment complex is a huge job with many tasks and responsibilities. At some point, you may decide you do not want the obligations anymore and decide to sell the complex.
Selling an apartment complex is often more complicated than selling a home or a single building. Your apartment complex is likely made up of many different units and buildings which means the sale process can involve quite a bit of work.
Ideally, you want to obtain the best possible sale price for your apartment complex but make the sale process as smooth as possible. Here are some tips to help you achieve that goal.
Priorities matter
Consider your priorities. You may want to sell your apartment complex as soon as possible or you might be more concerned with getting the best price. This might mean waiting longer, perhaps a year or more, to sell.
Although selling quickly could be best for your situation, it is usually better to take time to learn your goals and the best time to sell. A little patience can go a long way toward getting the best return on your investment.
Learn about your local market. Obtain detailed information about the trends in your local real estate market and review them regularly.
This includes any new construction in the area, changes in the demographics and the job market. Keeping up to date with this information can help you know when the best time is to sell.
Appraisals
Have your complex appraised. This is a common requirement in a sale and often both you and the buyer’s lender will have appraisals performed.
There are several different appraisal methods that can be used to appraise an apartment complex. Become familiar with them and determine which is best for you. When your appraisal is complete you are ready to set your sale price.
Once your sale process is underway, have the apartment complex inspected. You should know everything possible about the physical condition of your property and any defects that should be repaired before the sale.
All systems and components of the complex should be inspected. In addition to the physical structure, the electrical, mechanical and plumbing systems must be in good working order.
Know Arkansas law when it comes to inspections. You must comply with the law regarding commercial building sale inspections. Consult with a professional to verify that you have met all applicable legal requirements before closing.
Contracts and rental agreements
Review all contracts associated with your apartment complex with individuals or businesses who will continue to provide service to the complex. Learn the date you will stop being responsible for any payment for work performed under these contracts.
You should also thoroughly review all your rental agreements. Update any language to comply with any new legal requirements. Make sure your rent books are accurate and have a current list ready of any tenants with outstanding rent.
Taking these steps can help increase your chance of a successful and smooth sale.