Real Estate Agent for Sellers

Seller's Agent / Listing Agent

Selling an income-property at a top-of-the-market price requires more than just posting a pretty marketing brochure with pro forma income/expense data and waiting for the phone to ring.

Our Selling Process
Seller's Agent / Listing Agent

Why You Need a Seller's Agent?

The reality is, in most cases, months of pre-sale preparation is really required/recommended before the “property offering memorandum” is ever distributed to prospective buyers or brokers.

What all sellers NEED to understand BEFORE seriously contemplating selling is…

The primary metric for valuing income-properties is the capitalization of Net Operating Income. In other words, (all else being equal), the higher the supported Net Operating Income, the more an income-property is worth.

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Our Selling Process

Our experience has shown over many years that very few owners (even highly experienced private owner-investors) truly understand the impact of even a “few thousand dollars” of supported Net Operating Income on income-property valuation at selling time.

Let's take the below example and apply the step-by-step methodology and process Realty Yield encourages all sellers to go through before "launching" a property for sale.  Note: the data/fact-set closely aligns with an actual sale.

Example
Typical 30-Unit Apartment Building

This includes both the financial and physical components.

  • Current rents average $700 per unit which equals $252,000 in annual rent income.
  • Current other income (late fees - $600, laundry - $2,400, parking - $0, storage - $0, tenant utilities reimbursement -  $0, all other - $0) equals $3,000 annually.
  • Current operating expenses (taxes, insurance, utilities, maintenance, professional management, all other) equals $120,000 annually.

Hence, current Net Operating Income = $135,000 ($252,000 + $3,000 (-) $120,000)

Assuming a market capitalization rate of 6.75%, this equates to a current value of ~$2,000,000

Step 1

Pre-Sale Assessment of Property

Agent's Role
  • Analyze Rent-roll, Financials & Physical Issues
  • Quantify Value of Implementing Recommendations
Seller's Role
  • Provide Realty Yield Operating Financials
  • Work with RY To Complete Physical Inspection

This includes both the financial and physical components.

The financial factors include: current rents versus market/full rents, current other income versus potential, the current operating expense load versus optimal and any “easy/near-term” added-value opportunities that could be implemented before sale.

The physical components would include all “lower cost” aesthetic items (paint, landscaping, minor repairs, signage, lighting (exterior), litter & debris (exterior) and all/most minor unit deficiencies (worn out floor coverings, failing appliances, paint, etc.).

More often than not (unless the owner is a full-time professional investor and active asset manager), there is a list of both “financial” and “physical” items that a prudent owner should address PRIOR to advertising on the open market.  Furthermore, many of these items often can take months to correct/implement.

Unfortunately, too many sellers don't get the benefit of an analysis before they decide to sell.

Example Continued
Typical 30-Unit Apartment Building

Continuing with our 30-unit example case study above, Realty Yield’s assessment and analysis has determined:

  • Rents can easily be bumped to average $725 per unit, which equates to $261,000 in annual rent income (+$9,000 over current)
  • New “other income” can be generated by charging for extra parking spaces (10 spaces x $25 monthly = $3,000 annually) and implementing a utility bill-back program to have tenants contribute to raising utility costs = $5,500 annually).  Total increase estimated @ +$8,500 annually.
  • Operating expenses can be reduced in the following areas:
    - Utilities (garbage) by reducing number of receptacles from 3 to 2.  Savings = -$1,800 annually
    - Repairs & Maintenance by utilizing third party subcontractors versus property management company personnel.  Savings = -$5,700 annually
  • Minor physical deficiencies appear to negatively impact the number of drive-by inquires and application of quality new tenants.  Additionally, existing tenant perception is that owner is not maintaining property adequately.

The financial ramifications of the above, to a selling owner, cannot be overstated.  The projected increase in likely sale price by acting on the above is/was as follows:

  • Projected rental income: $261,000
  • Projected “other income”: $8,500
  • Projected operating expenses: <$112,500>
  • Projected NET OPERATING INCOME: $157,000 (up from $135,000)

Assuming the same market capitalization rate of 6.75%, this equates to a new/projected value of ~$2,325,925.  Most owners would make the choice of waiting a few months before selling if this eye-opening analysis was simply communicated by a seller's adviser/listing broker.

Step 2

Pre-Sale Strategy & Action Plan

Agent's Role
  • Draft, Direct & Manage Pre-Sale Action Plan & Timeline
Seller's Role
  • Provide Input & Approve Pre-Sale Plan & Timeline

The reality is that initiating a rent bump, implementing a utility bill-back program, collecting parking space income, transitioning to third party R&M vendors and fixing a laundry list of repairs is going to take some period of time before the improved financial results are reflected on an operating statement.

Realty Yield will work with you to draft a written plan and timeline as well as participate in the execution and management of this process.  We do it all the time.

Realty Yield is not one of those brokers that will hurry you to market just to close a sale and make a commission.  In fact, in many cases I strongly recommend just the opposite.  Ask my clients directly -- they will confirm this is true.

Step 3

Pricing & Offering Memorandum

Agent's Role
  • Determine Current/New Property Value & Suggest Price
  • Prepare Offering Memorandum
Seller's Role
  • Approve Listing Price and Offering Memorandum

In order to price a property properly we will compile a list of like-kind comparable sales, perform our own valuation analysis, review recent appraisals of similar properties, review current for-sale competition and factor any value-add/upside opportunities, which the subject property would afford a buyer.

Pricing should be done right from the get-go.  We don’t "buy" listings; in other words we won’t tell you your property is worth more than it really is just to get a listing, then later ask you to lower the price because the “market has changed.”

You will get an honest opinion-of-value for your property from the beginning.  We encourage sellers to think like buyers.  If you wouldn’t buy your own property based on what is being presented, why would someone else?  Again, top-of-market but realistic initial pricing is required if you want to work with us.

Realty Yield will then prepare the Offering Memorandum (marketing packages).  Our marketing materials are the culmination of many years of experience in knowing what gets results for our sellers and what doesn’t.  But again, don’t take our word for it.  According to the analytics from LoopNet (the #1 commercial-investment real estate listing site on the Internet), our listings are consistently in the top 5% of most accessed (clicked-on).  The numbers don’t lie.

Our materials work because we don’t rely on generic, regurgitated data points.  The emphasis is on the numbers (likely investment returns for a new owner/buyer).  After all, isn’t the bottom-line about making money?  Yes, we also appropriately feature a representative sample of quality photos, rent comparables, sales comparables, market/sub-market and demographic information, maps, etc.

Our marketing packages are very focused on clearly differentiating your property (why a buyer should invest in it) supported by objective, compelling financial/investment return metrics.

All sellers should ask to see samples of a broker’s marketing materials before retaining them.  I look forward to sharing mine with you.

Step 4

Marketing & Advertising

Agent's Role
  • Expose Property Through All Available Channels
Seller's Role
  • Inform Realty Yield of Any Material Changes In Property Operations, if applicable

There is no downside to maximizing exposure.  Obviously, the more qualified prospective buyers the offering gets in front of, the better.  We utilize all the following channels:

  • Commercial property listing websites (LoopNet, Showcase/Co-Star, CIMLS, Commercial Source, VerticalEmail, RMLS, Apartments For Sale, more…)
  • The broker community
  • Outreach to principal owners of other investment real estate
  • Current Realty Yield clients
  • Mid-high net worth individuals reallocating capital from other asset classes
Step 5

Putting a Deal Together

Agent's Role
  • Assess / Qualify Buyers
  • Negotiate Price & PSA Terms
  • Manage Process Through Closing
Seller's Role
  • Approve Buyer, Price and Contract Terms
  • Support Realty Yield During Buyer’s Due Diligence Period

Not all buyers/investors are created equal.  Circumstances, motivation, buyer experience, and selling broker's expertise all factor in on “selecting” the right buyer.  Our experience will pay big dividends here and all but eliminate false starts.

Negotiating/maintaining a final agreed upon sale price, which is at/close to the full listing price is much easier when the groundwork has been properly laid.  Since we support our listings and pricing with objective, verifiable data, big price concessions are not something our clients/sellers have to deal with.

Having said that, negotiations are part of every deal.  I have directly brokered more than $200,000,000 worth of investment real estate deals.  There is no substitute for experience.  I know all brokers/sales people say they are expert negotiators, but if you ask my clients they will confirm that claim with their real world results.

One other key added-value component we bring to our listing agent services is that we also broker commercial mortgages (the financing most buyers need/want).  Deals fail for financing reasons more than anything else.  This won’t happen with us.  We know without a doubt what loans are available, what amounts can be borrowed and which buyers will be able to secure financing.  In the many cases in which we end up doing the financing for the buyer, it turns out to be a win-win for everybody.

The bottom line is that our experience results in very few sale-fails once a property is put into contract.

Real Estate Brokerage
Transactions
Apartment / Commercial Financing
Transactions
1031 Exchange
Transactions

Why Choose Us?

At Realty Yield, we want your investments to succeed. All investors need a plan, whether your goal is capital (equity) growth, maximum cash flow, realizing optimum tax benefits or any combination thereof.

Effective real estate investing requires a strategic approach and "Buying, Holding and Hoping" is just not an intelligent strategy.

The experts at Realty Yield will guide you through the complex and ever-changing world of real-estate investment with confidence.

Other Real Estate Investment Firms typically don’t provide the ongoing guidance most real estate investors need, because most brokerage firms are only engaged during the buy/sell moments. At Realty Yield, we know that lasting wealth comes from making the right decisions between the time when you buy and when you sell. It’s knowing what to do in these moments that sets us apart.

By working with us you’ll benefit, no matter what your needs, whether you are looking to buy real estate property, sell real estate property, complete a 1031 exchange, secure a commercial loan, consult on investment real estate / portfolio performance improvement strategies, or executing a tax favorable exit strategy at retirement.

You are more than just a client, and we are more than just a brokerage firm. That’s why, at Realty Yield, we make a personal commitment to you, to create your own, unique, expertly crafted, Personal Real-Estate Investment Strategy. We give you the best results because we have the knowledge and experience to create your best plan of action. We’ll guide you through those vital decisions of what to do, how to do it, and when to do it.

We succeed where others fall short. So, ask yourself, are you really realizing the returns you could be?

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Client Testimonials

All Testimonials
Mike Carlson has the ability to analyze and plan a strategy which takes advantage of market conditions, incorporates the best financing options and most importantly, maximizes the return on your equity. Mike is the real deal, honest, trustworthy and highly capable. I am happy to recommend him to anyone looking for assistance with their multi-family portfolio.
Gary M
2003 ~ Current
For anyone with real estate investments, Mike Carlson’s services are a necessity in order to achieve top results. Mike Carlson is very astute and knowledgeable in not only all aspects of real estate investment and wealth management but also in a wide scope business matters in general.
Lynn L
2005 ~ Current
Mike Carlson and his company are great - very professional, experienced and comfortable to work with. Mike’s analysis and technical abilities is top drawer! He knows how to evaluate portfolios and properties to determine the best investment strategy. Mike Carlson’s brokerage and negotiation skills are very polished and effective. Make no mistake about it; there is a distinct advantage in utilizing an experienced financing liaison. Carlson not only found good properties but also good financing. He made the entire deal work!
John B
2003 ~ Current
Mike has been what I was looking for in a commercial realtor. He has the unique ability to apply financial numbers to a project and not let the emotions of a property cloud the analysis. Working with Mike has always been about good communication and he does a great job. When you do finally find a property worth pursuing he is not pressuring you to make the offer and get the commission. It’s more about the long-term relationship. He reassured me that if he does a good job on this deal I will probably be back for more and sure enough I am in the hunt again.
Clinton L
2008 ~ Current
We were so pleased with Mike’s handling of the sale, purchase and financing of our real estate that we referenced Mike as a contact for our children and our attorney if we should die and the children were to be left with the apartments. We knew that Mike would be honorable and not take advantage of them in settling our real estate holdings.
L Family LLC
2004 ~ Current
I have had the privilege of having a close personal friendship with Mike Carlson for nearly 30 years. As a friend, Mike is a standout. He is a loyal, honest, considerate, and supportive individual who has the ability to see and understand things from another person's perspective. Mike's candor and business savvy merely scratches the surface of his character. As he would for me, I would do anything to help him or his family.
Chris H
Current
I have been working with Mike since 2002. He is the driving force behind the investment real estate strategies implemented leading to our wealth gain over the last 8 years. He has handled all of our significant transactions and loans. When I contacted Mike in late 2008 and told him I thought I wanted to retire and sell my properties, he actually talked me out of it. How many brokers have you ever met that passed on a significant commission because he knew the market timing was not right? He told me the same thing again in 2009. If this doesn’t show his integrity and prove that he always has his client’s best interest in mind, I don’t know what does. I will act when he tells me its time.
Linda G
2002 ~ Current
Mike Carlson possesses an amazing range of skills and abilities from a constant understanding of the big picture to meticulous management of all the details of complex investment real estate transactions. For anyone with real estate investments, Mike Carlson's services are a necessity in order to achieve top results. Mike Carlson is very astute and knowledgeable in not only all aspects of real estate investment and wealth management but also in a wide scope business matters in general.
Lynn W
2005 ~ Current