You have completed your first of many rehab projects. You tell yourself, “I have made it through all the setbacks.” You pat yourself on the back. You are energized for your next project. Every contractor has performed. Signed all my lien releases. The lender has fulfilled their respective promise to fund the property. The realtor has agreed to the terms of the commission. 

We have done all the due diligence. We reviewed neighborhood sales and appraisals. We list the property at or below market. All the planets seemed to have aligned. Finally, the property is listed. Every key player has been paid. It now time for me, to get rewarded for all my hard work. 

All the sound great, but before we get to the end of the project. Let’s briefly examine a few exit strategies: 

  • 60-90-day sale price reduction 
  • Incentives 
  • Rental 

It’s expected for the property to sit on the market for at least 30 days. Within the first 30 days you are testing the market to determine if your property has the design esthetics, price and location to attract potential buyers. An excitement brews daily as potential buyers request to see your property. 

Meanwhile, 60 days have passed, and your property is still on the market. After 60 days you have not received an offer. The first thing you’ll think is where did I go wrong? I am here to tell you; you did nothing wrong. What you feel is your exposure to risk. You and the property are at the mercy of the real-estate market. Remember, the risk we spoke about in earlier chapters. We are at that point. You begin to experience this love hate feeling about the wonderful risk filled real-estate world. 

An additional, 30-60 days go by without an offer. Your realtor will ask to reduce the sales price. The attempt is to not have the property sit on the market. This is your first, Exit Strategy. 

Reducing the price does not mean the property will sell any quicker. Your realtor is trying to gauge the market, while casting a larger net to find buyers. Second exit strategy, as the seller. You offer incentives, (i.e. closing assistance, household appliance etc.) This strategy works sometimes.