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How to Sell a Rental Property in Oklahoma

The rental property market in Oklahoma continues to be competitive, with a good rental property you can sell a rental property in as little as 30 days. Seeing what local houses are selling for in the area may cause some landlords to decide to jump on the bandwagon and sell so they can move on to their next investment. But how can you get the most money possible for your property in today’s market? Find out more below.

Why Sell a Oklahoma Rental Property?

Investing in real estate and acquiring rental properties is widely regarded as a wise financial decision in today’s economic landscape. The real estate market is thriving, with numerous regions facing housing shortages, making rentals a lucrative long-term or short-term investment opportunity. Even if opting for a short-term investment strategy, the rapid appreciation of properties across various states continues to position rental property investments as a prudent choice for portfolio diversification. Before making a sale, it is crucial to manage the transaction efficiently to minimize taxes and maximize profits.

Options When Selling a Rental Property in Oklahoma

When it comes to selling a rental property in Oklahoma, the process can vary from simply putting up a For Sale sign and listing it on the MLS to navigating complexities that may arise with existing tenants under a current lease agreement.

Before proceeding, it’s crucial to familiarize yourself with the specific regulations at the county, city, and state levels to ensure compliance when listing a property for sale. It’s essential to explore all available options within the legal framework.

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  • Waiting for the Tenant’s Lease to Expire

If you’re in no rush and have time, waiting for the Tenant’s lease to expire might be your best option for to sell a rental property. Not only will you be able to continue to collect your monthly rental revenue, but you’ll have time to find the right real estate agent to sell your home or a savvy investor that has cash in hand and is ready to buy right now. Waiting for the lease to expire may also allow you to avoid dealing with awkward showings while the renter is still in the property, or an angry Tenant who decides to take steps to not allow the sale of the home.

  • Pay the Tenant to Vacate

Even if this is required by county, city, or Oklahoma law, offering cash to your renter(s) to break their lease and/or move is a fast and straightforward option for getting a Tenant out of the home. Not only that but paying cash to vacate your rental property can be beneficial to both you and your Tenant. In these situations, a landlord and their Tenant(s) come to a monetary agreement that allows for the lease to be broken with no legal repercussions. This is a win-win for both parties; you get to put the rental for sale on the date of your choice and your renters have a cushion for moving on to their next home.

  • Sell the Property to Your Tenant

Maybe you’ve grown tired of owning a house that is aging and needs expensive maintenance and repairs you don’t have the time, energy, or funds to complete. Or perhaps you’ve decided to move on to your next investment but you’d like to see the rental property stay in the hands of someone you trust. That’s when selling the property directly to the current occupants of the house might be a great option! Whether it’s done as a traditional home sale or as a lease-to-own situation, you’ll no longer have to deal with the hassle of that unwanted rental property while still profiting from any appreciation on the property during the time you owned and managed it.

  • Sell the Property with an Active Lease

If you’ve decided to sell your rental house but you still have an active lease associated with the property, can you still sell? Yes, you can! 

For some investors interested in a rental property to add to their portfolio, your occupied house with an active lease is preferable to one that is vacant and requires the work of finding renters. If your Tenants have a good history that includes a security deposit with their lease, are consistently on time with their rent, and maintain the house and land around it, this is a great selling point for the house’s next investor!

  • Sell Your House to Petit Home Solution-We Buy Houses

Sometimes selling an investment property in a non-traditional way can mean less hassle for real estate investors looking to move on to their next investment. If selling your rental for a fair cash price sounds like the right option for you, Petit Home Solution-We Buy Houses can help. Make the sale of that unwanted rental property as easy and stress-free as possible. Get a competitive cash offer faster than you could get with a traditional home sale by working with a local house buying company that has built their business by buying houses for cash. 

When to Sell a Rental Property in Oklahoma? 

Is there a specific time to sell your rental property? When you feel it’s time to sell! Whether you’re a landlord who is tired of the time it takes to manage their own properties, or you’re ready to cash in on the appreciation of a rental house so that you can move on to a new investment, the best time to sell a rental property is up to you. Sometimes properties take a negative slide, with maintenance costing more than is covered by the rent. Regardless of the reason you are selling, you’ll want to consider the following while trying to decide if now is the right time to sell:

  • Equity Level is High on the Rental Property

New data by the Federal Reserve shows that the national median home price has risen 42% since January 2020*. If you are looking to invest in new properties or would like to diversify your investment portfolio, now might be a good time to turn that home equity into cash while home prices remain high.

  • Housing Demand is Strong 

Whether you’ve heard it online, on the news, or in your local paper, despite inflation the demand for housing is still exceeding the supply for homes in cities and suburbs all across America. Realtor.com’s June 2023 Housing Report shows that homes are selling fast amid the continued inventory crunch. For the month of June, the total number of unsold homes, including homes that are under contract, decreased by 4.6% compared to last year. With 25.7% fewer homes newly listed for sale compared to last year, it’s no surprise most homes spent only 44 days on the market.

  • Market Dynamics are Changing

Also included on the Realtor.com housing report was that the median price of homes for sale decreased by -0.9% annually in June, which is the first decline seen in the data trend history since 2017. Does this mean investors who want to make a profit from their property should panic? Not necessarily. Estimates are modest for any possible downturn in housing prices over the next few years. Realtor.com noted that by the end of the month, inventory had actually declined for the first time since April 2022. But there may be other factors at play in your area. With many cities experiencing an influx of new construction, you might be finding it harder to rent.

  • Rising Interest Rates

If you are ready to sell your rental property and want to invest in your next property, be sure to keep an eye on those mortgage interest rate changes! Rising interest rates can make buying rental property more expensive for investors, as well as causing less demand in the housing market which could drive your selling price down. 2021’s extremely low-interest rates have passed, with a 30-year fixed mortgage now as high as 7.8% for homeowners. 

  • Property Needs Repairs – High Maintenance Costs 

The years have passed and you’ve had more than one tenant using (and sometimes abusing) that rental property you bought brand new. Investors with houses, condos, and other types of property that have maintenance and repair bills adding up for those necessary upgrades may find it makes more financial sense to sell. A replacement water heater, a new roof, or an overhaul of the HVAC system can add up quickly, pinching your bottom line. Look over the numbers and see if selling at a slightly lower price may keep you from losing even more money to that rental property money pit.

Steps to Take Before Selling Your Rental Property 

  • Identify Target Buyer

Are you considering selling your property to another investor in Oklahoma? Or would you rather hand over your rental property to your tenant or a family in search of their first home in Oklahoma? Identifying your target market is essential when selling your property. Knowing your target buyer will help you determine the right pricing strategy for a successful sale.

  • Decide on Your Pricing Strategy

When you are ready to sell your rental house, condo, or property, you’ll need to focus on your overall objective. Do you have time to wait and are looking to get the biggest profit possible? Would you prefer to sell quickly and with little to no hassle? Will you be able to sell the home vacated or will there be an active lease on the property? All of these things can affect your overall sale price!

  • Buyers Inspection and Do Repairs

If you are aiming to maximize profits from the sale of your rental property in Oklahoma, ensuring a smooth appraisal and buyer’s inspection process is crucial. Prior to listing the property, it is essential to verify compliance with all codes and ensure the property is market-ready. Seek guidance from a seasoned broker and arrange for a pre-buyer inspection. This proactive step can potentially save you valuable time that would have otherwise been spent on unexpected negotiations and unanticipated repairs.

  • Run a Lien Search

Do you still have a mortgage or some sort of financial loan on the property? If so, you most likely also have a lien from the lender against the title. This is only removed when the house sells and the mortgage is paid off at the close. However, there might be liens you aren’t aware of. To make sure there are no encumbrances you need to deal with before selling, ask an escrow officer to order a title search. If something comes up, take care of it before putting the house up for sale.

  • Inform Tenant

Be diplomatic! Most states require landlords to let their existing Tenant(s) know the property will be going up for sale. To keep things civilized, let your renters know with as much notice as possible that you will be putting the property up for sale. 

Make sure to keep up-to-date on the requirements of state and local laws to avoid the hassle of legal clashes due to misunderstandings or a lack of knowledge of the law. Some renters may have previously dealt with their rentals going up for sale, but to others, this might be a new (and scary) process. Reassure them that the sale will not affect their lease and that the security deposit will transfer to the new owner.

  • Analyze Capital Gains

When you sell your rental property, you’ll need to pay tax on depreciation recapture and any remaining capital gains. Due to this, many investors hold on to properties longer than they should due to a fear of losing too much profit to the Capital Gains tax. But there are straightforward ways to avoid capital gains. 

While holding on to an investment, owners will often use the depreciation expense to reduce taxable net income. But, when the property is sold, the total expense that was claimed is taxed as regular income up to a rate of 25%. But there is a way around this! The 1031 tax-deferred exchange allows investors to defer paying these taxes on their investment properties by purchasing a replacement property within 180 days of selling.

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The Bottom Line is…

If you own a rental property in Oklahoma that you are looking to sell with less hassle and for more money, Petit Home Solution-We Buy Houses has a solution. We are a direct house buying company that has built our reputation on buying houses for cash with less stress (and less fees!). Contact us today and get a competitive cash offer for that house or rental property. We buy homes in any condition, and we don’t mind purchasing properties that still have tenants! Even if the house needs upgrades and repairs, we want to make you a fair cash offer today.

Frequently Asked Questions

What is a Rental Property?

A rental property is essentially a house or apartment that an owner rents out to tenants in exchange for monthly payments. Think of it as owning a piece of equipment that others pay you to use. The concept is straightforward: you have a property that you don’t live in, and instead of leaving it vacant, you allow someone else to live there for a regular fee.

How Can I Sell My Rental Property in Oklahoma?

Selling a rental property in Oklahoma involves a few specific steps to ensure a smooth transaction. Here’s a straightforward guide:

  1. Communicate With Tenants: It’s crucial to inform your tenants about your decision to sell. This step respects their rights and prepares them for the upcoming changes.
  2. Understand Legal Requirements: Every state has its own laws regarding the sale of rental properties, especially when tenants are involved. Familiarizing yourself with these regulations can prevent legal issues down the road.
  3. Prepare the Property: Just like selling any home, enhancing your property’s appeal can significantly impact your sale. This might involve minor repairs or cosmetic improvements.
  4. Choose the Right Partner: Working with a real estate expert, particularly one that specializes in rental properties like Petit Home Solution-We Buy Houses, can provide invaluable assistance. They understand the market dynamics and can navigate the complexities of selling a rented space.
  5. Price It Right: Setting a competitive price for your property is critical. This involves analyzing the market and possibly consulting with your chosen real estate professional.
  6. Market Your Property: Utilizing various channels to advertise your property ensures it reaches a broad audience. This can include online listings, real estate agents, and word of mouth.

Why Would I Want to Sell My Rental Property?

There are numerous reasons why someone might decide to sell their rental property. These range from wanting to liquidate assets for personal or financial reasons, the desire to invest elsewhere, challenges associated with being a landlord, or simply the right timing in the market to sell for a profit. The decision is often personal and based on individual circumstances.

What Makes Petit Home Solution-We Buy Houses Effective at Selling Rental Properties?

Petit Home Solution-We Buy Houses excels in the real estate market, especially in Oklahoma, by combining deep local knowledge with extensive experience in handling rental properties. Their approach involves a tailored strategy for each property, focusing on optimal pricing, effective marketing, and seamless transaction management. Their reputation for professionalism and success in navigating the sales process makes them a go-to for those looking to sell a rental property.

How Long Does It Take to Sell a Rental Property?

The timeline for selling a rental property can vary widely depending on factors such as the current market conditions in Oklahoma, the property’s condition, and how well it’s priced. On average, it could take anywhere from a few weeks to several months. The key to a quicker sale often lies in effective preparation, pricing, and marketing strategies.

Can I Sell My Property If It’s Currently Rented?

Yes, selling a property with tenants is possible. However, this process requires careful handling to respect the tenants’ rights and comply with local laws. Open communication with the tenants about the sale process, considering lease terms, and possibly offering incentives for cooperation can facilitate a smoother transition.