I did an experiment last fall. I bought a house with the intention of renovating it and listing it on an online rental property exchange. The renovations went great. The house rented quickly. Then it was time to test.
There are a couple such exchanges to choose from now. I used one of the more popular ones. My review is based on my experience from the sellers perspective.
I think they have a great concept. To be able to utilize this platform would be a valuable tool in the “toolbox.” Both for myself, and for clients.
Unfortunately, the property didn’t end up selling. It was listed for about 40 days. Luckily, it’s a fantastic property with great tenants in it, so I’m happy to hold on to it a little longer.
I did learn some things about their process. Some good, some bad. If I decide to utilize their exchange again, I will definitely to do things differently.
The Good
- It’s a fantastic idea. An exchange for leased property is a niche market. It’s is very under-served. The needs of these sellers are different than traditional sellers. These exchanges are making a good effort to serve them.
- Selling with minimal contingencies is attractive. They do a pre-listing inspection. After making sure your property meets their standards, they list on their exchange with no inspection contingency. (In theory)
- They boast over 60,000 registered users. Your home will meet the search criteria for many of these users. They will receive email alerts when the home is listed.
The Bad
- The actual exposure my house got was unimpressive. My listing had about 275 lifetime views. I could have achieved that on my own. I was really expecting somewhere in the 1000’s.
- Inaccurate information. The pre-listing inspection seems like a great idea. My problem was that the inspector reported a number of things inaccurately. For example, the brand new roof we put on got rated as 5-10 years old. Also, somewhere he found a 3rd bedroom I didn’t know about. Knowing the subjective process of inspection, I’ll change my rehab strategy if I decide to sell another one on this exchange. I would’ve done a much smaller scope of work. I definitely spent some money that I didn’t get credit for on the inspection report.
- Technology issues. When I first submitted this house for listing they rated the neighborhood at 3.5 stars. I thought that would be a good selling point. It is a good, safe neighborhood, in a solid school system. However, once the listing went live, it showed as “rating not available.” I mentioned this to my contact, but it was never resolved.
Summary
I would list on this exchange again in the right circumstances. After utilizing their platform, I have a better understanding of what the right circumstances are. I think over time their performance and technology will continue to improve. When that happens I believe they’ll fulfill their potential.