What to prepare
Investors and lenders will ask for the numbers early. Having them organized can speed up offers and reduce back-and-forth.
- A current rent roll: each unit's rent, lease dates and deposit
- Copies of all leases and any amendments
- Operating expenses: taxes, insurance, utilities you pay, maintenance and management
- A repair and improvement history, with dates and receipts
- Any permits or certificates your locality requires for rentals
Who buys multi-family homes
Investors buy for income. They focus on cash flow and return, and some will pay cash or use investment financing.
Owner-occupants plan to live in one unit and rent the others. They can often use FHA or VA financing on a property with up to four units, as long as they live in one. That can widen your buyer pool, but those loans come with their own property condition standards.
How buyers value it
Pricing usually combines comparable sales with the property's income. Strong, documented rents can support a higher price. Vacancies, below-market rents or deferred repairs can lower it.
- Rent roll and lease terms
- Operating expenses and net income
- Cap rate and cash flow compared with similar properties
- Condition of each unit and shared systems, like the roof and heating
Tenants in place
In many places, leases transfer to the buyer when the property sells, and the buyer becomes the landlord. Tenant deposits usually transfer too. Give tenants proper notice for showings and inspections, and follow your state and local rules on entry. Cooperative tenants can make showings much smoother, so keep them informed.
Getting units ready
Focus on repairs that affect safety, inspections or rentability. Vacant units are easier to stage and show. For occupied units, ask tenants about tidying ahead of showings and schedule visits with care.
Taxes to plan for
Selling an investment property can involve capital gains tax and depreciation recapture. If you live in one unit, part of the sale may be treated differently from the rented part. A 1031 exchange may let you defer tax if you buy another investment property. The rules are detailed and time-sensitive, so talk with a tax advisor before you list.
Selling with CapCenter
Our standard listing fee is 1.5%, with a $3,000 minimum. Sell with us and buy, or finance, your next home with CapCenter within a year, and it's 1%. Restrictions apply, and the buyer's agent's commission isn't included. See our Offer details.
