The first part of the acquisition process is locating a property with remodel potential or the opportunity to be built new from the ground up. We work directly with many homeowners that have a desire to sell for a variety of reasons. Pike Properties tends to be a solution for homeowners if:
- A property has been inherited in an estate
- The home is extremely dated
- The home’s needed repairs are too substantial or too expensive
- The owner lives out of state and the property is vacant
- Foreclosure proceedings have started
- The seller needs to sell quickly for any reason
These are just a few of the reasons homeowners connect with us to sell their property. In addition to working directly with property owners, we often receive referrals from local real estate agents, neighbors, attorneys and other professionals in the area.
Once we connect with an individual, we prefer whenever possible to have an in person sit down in order to review the goals the homeowner has when selling their property. This is the most important part of the process because each situation is unique and each person has different factors that are important to him or her. We pride ourselves on not being a one size fits all company. In short, we listen. Rest assured if we we’re not the right fit, and our services don’t line up with a sellers goals, we will happily refer them to another person or company who can serve them better.
Once we’ve met with a seller and both agree we are a fit to help one another, the next step for us is to analyze the property to establish an “as-is” value.Essentially, this is the market value of the property in its current condition. Generally we are able to perform this analysis and share results with the homeowner during our initial meeting. The reason being is both principles of Pike Properties are licensed Realtors® and have a combined experience of nearly 20 years as licensed professionals. Being able to provide this information on the spot is extremely beneficial because many times our clients are interested in receiving an offer quickly.
The next step in the analysis process is to determine a repair cost to bring the property up to today’s buyer standards. This does not mean just functional or simply working order. This means congruent with neighborhood standards and 3-5 year deferred maintenance for the incoming buyer once remodeled. Our goal is not to remodel to the bare minimum standards and leave the buyer with a home that will need work in the coming years. Many of the repair items we find include structural issues, mold, major electrical and plumbing updating, roof replacement, heating and air replacements, and general cosmetic improvements. During our property inspection, we will complete a detailed repair estimate to determine our cost to improve the property. This allows us to be very accurate in what we can offer as a cash purchase price.
Lastly, we determine what we believe the resale value will be once we are complete with the remodel or build. A comparative market analysis is completed on the subject property, which is achieved by comparing it to like properties in the neighborhood. The CMA will allow us to hypothesize what fair market value will be once construction is complete.
At Pike Properties, we believe strongly in full disclosure, and it’s our goal to provide a home seller with as many options that their individual circumstances allow for. We are happy to walk-through what a simple cash offer would look like, as well discussing what would be entailed if they decide to try and list they home for sale in a typical fashion. We will also share any repairs needed (and the costs involved) that we found during our property walk through. Our goal is never to “sell” a homeowner on any one particular solution, but rather educate them so they can be empowered to make the best decision for their particular situation.
Most of our clients find our cash offers are very fair and opt to work with us in that capacity. Once we agreed on price and terms, we will then write an offer to purchase on a simple 2-page agreement and go through each line item with them to ensure they understand everything. If we agree on a purchase price, we will buy as-is (without asking the homeowner to make any repairs) as well as close on their timeline. As a real estate company that buys and sells properties consistently all year round, we can be accommodating on time frame. We can close in as little or long as the client needs. Funding will get sent immediately to the closing attorney and a closing date will be set up.
One important component of any real estate closing is performing a title search. Pike Properties will pay for an attorney to perform a title search, which in certain circumstances will uncover issues that will need to rectified prior to being able to close. For example when we are buying a property that is going through probate, or part of an estate, it is likely that there will be some extra steps needed to ensure title can be conveyed properly. Any issue that arises will be something the closing attorney will help guide us through, and we will all work together to ensure we have a smooth transaction. With literally hundreds of real estate transactions completed at Pike Properties, there is rarely a challenge that we can’t find a solution for. We pride ourselves on being a company that has the drive and knowledge to work through even the most challenging of circumstances.
Finally we will meet on the day of closing in the attorney’s office and sign the necessary legal documents. The transaction will be recorded by the attorney that day or the next and money will be dispersed once the deed transfer is recorded at the courthouse.
The final phase our process is to redesign, reconstruct, and repair the property to its optimal condition. Our team will spend hours designing, planning, and reconfiguring a home before we settle on a final scope of work. Once that final scope has been approved, a licensed and insured construction team will be chosen to execute and complete the work. As always, the necessary permits will be pulled to ensure the construction completed is up to local Mecklenburg County code.
The construction phase is not only the most time consuming step of the process, it also is where most of the unknowns arise. We always purchase with a plan of attack and general outline of what we intend to create. However, when renovating older homes, you simply don’t know what you’re going to find until you start the process and open up walls or floors. These occurrences will create delays and undoubtedly increased costs. This is one of the reasons a cash, as-is, offer is often the best choice for a property owner. As an investment company, we at Pike Properties expect and account for these hiccups during the building and construction process.
Lastly we prepare the property to ensure it’s in the best condition possible before listing it for sale. Preparations will include staging, internet marketing, brochure creation, MLS listing, and a multitude of other tasks needed to list and sell the home. As licensed real estate agents, having areal estate license and knowledge gives us a competitive advantage that other don’t have. One advantage is that we don’t have to pay ourselves a real estate commission to sell our own properties. This savings can often times be significant. By minimizing our transaction expenses on the back end, we can actually afford to make a higher offer on the front end when we are working directly with homeowners.