Second Selling Experience

Although my wife and I have purchased a dozen properties over the years, we’ve only sold two! Number two was just last week! This particular property was our home for eight years and while at the end of the day, we did well on the transaction, there were still some “buts” during the experience. I enjoy sharing my lessons learned, so you don’t have to learn the hard way!

First, it’s pretty safe to say the real estate market is in an odd place right now. Prices are high, interest rates are high, and inventory in many areas is low.  That being said, when you ask someone around here if it’s a buyers or sellers’ market, you usually won’t get a straight answer.

The market in our area has cooled over the past year and when we listed our home back in October, we really didn’t know what to expect. Bottom line, once listed, we didn’t have a line of buyers looking to view the house! I firmly believe this was due to market conditions and through no fault of our own. We applied the lesson learned from our first selling experience and had our home absolutely sparkling. It looked like a brand new one! Fresh paint, new sod and a new range hood are just a few of the $10k we spent getting it showroom ready.

BUT that brings me to the first lesson learned, location, location, location. If you’ve read any of my stuff, you’ve heard me say this hundreds of times and in this case, location proved itself a truth yet again. When we bought our home back in 2015 there was a lovely 20-acre field sown in cotton, wheat or corn depending on the year directly behind our property. It made for a beautiful view in the mornings! We knew there was some risk as the land was zoned commercial, but hoped for the best and planted obscuring trees which grew tall and wide.  About three years ago, developers started doing what they do and developed the parcel. Unfortunately, a basketball gym, gas station, oil change shop, and pre-school sprang up directly behind our home!

While the home still set in a desirable neighborhood, in one of the best school districts in the state, the view out the back door didn’t help marketability much. We knew this would knock out some potential buyers; we would just have to wait until the right buyers came along.  

We made a few price drops within the first six weeks but still weren’t getting the buyer interest we wanted. I wasn’t in panic mode, we had a beautiful home, at a fair price in a good location but was a bit unnerved that we hadn’t even received a low-ball offer yet! That’s when we decided to add to the listing write up, “assumable loan at 2.625%”. Our real estate agent had advised that while this may boost interest in the listing, assuming a VA loan is not an easy thing; it could take a buyer over 120 days. Turns out she was correct.

Immediately after adding the “assumable loan” hook, we started getting showings and a lot more interest in the home, until finally after almost eight weeks on the market, we got an offer! While the offer was at the low end of our desired range, it was still in range. The buyer was solid, and we went under contract.

The home inspection was a snap, with the home only requiring a few minor touches, totaling less than $1000. Everything seemed to be working out.

BUT our closing was not for another four months! Turns out anyone can assume a VA loan, but the process is arduous.  The buyer works through the bank which held our mortgage and truly just assumes the note. The only drawback is to the seller who loses a portion of their VA home loan eligibility for the amount that is assumed.  This was ok with us as, at our age, we are looking to get less loans, not more!

I thought four months would seem quick, but it didn’t. Weekly visits to the property to flush toilets, check for leaks, check the mail and ensuring the home was properly winterized was just the start. Four extra months of utilities and mortgage payments certainly wasn’t pleasant, at all! Perhaps the worst is just the uncertainty and anxiety that comes with waiting and waiting for a deal to go through.

Alas, all good things come to those who wait and last Friday, we closed on the property. We took home a nice net gain which we’ll use to pay down debt, invest and make some needed improvements on our new home. I can’t complain, we are very thankful.

BUT there were some lessons in this deal which I’ll conveniently recap for you:

1. Keep your house maintained and when it’s time to sell, have it looking tip top. The extra cost is worth having one less thing to worry about during an already tense situation.
2. Understand the pros and cons of a location. Down the road, they may develop that commercial land behind your home into the trendiest shopping and restaurant district in town…. or they may stick a gas station there!
3. Lastly, VA assumable loans ARE a great selling point and a benefit for a potential buyer. That being said, it takes FOREVER to close when a VA loan is assumed. Be mentally prepared to deal with 4-6 months closing.

Interested in rental property investing? Look for Collect Rent, Don’t Pay It: A Beginner’s Guide to Rental Property Investing on Amazon to learn how our family turned rental property investing into a successful side hustle!

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