Real estate sales are never simple, particularly for church leaders and faith-based organizations that lack the knowledge of exactly what goes into a real estate transaction. Let’s review 3 of the biggest mistakes that community leaders can make after deciding to put their church building on the market.
1. Forgoing Consultation/Advising
With how volatile the real estate market has been over the past few years, entering into any kind of transaction can be a worrying proposition. This is especially true for local communities and faith institutions that lack the financial experience and property management skill set necessary for planning commercial real estate transactions.
If your faith-based organization is planning on putting its church building up for sale, professional consultation is often invaluable. These services can help you accommodate your market’s priorities, assess property values and determine the best way to reconcile the financial needs of your organization with the religious communities you’re serving.
2. Forgetting Administrative Complications
Real estate transactions are complicated. It’s natural for there to be some hiccups in the process, though these hiccups might create more problems for you than you realize. As any real estate agent can attest, the paperwork involved in a real estate transaction can be overwhelming.
Contractors may need to be brought on to assess the property and landscape to verify that its condition aligns with your asking price. This may be a lengthy process, depending on inspector availability and the size and age of your church.
Transactional issues with your buyer may also arise that throw your deal off schedule, sometimes requiring lengthy re-negotiations that can prolong the buying process far beyond your initial estimates. These administrative issues tend to raise the amount of overhead needed to close the transaction–making it essential that any community organization involved in real estate sales be aware of hidden costs that can throw off your timetable.
This is another area where a consultation may work in your favor, providing you with the insight necessary to proactively assess these issues before they significantly affect your bottom line. A professional assessment can also give you an idea of how best to leverage the income gained from your sale. Reinvestment in local and faith-based services can both support the community that you’ve pledged to serve while giving you the financial freedom to focus your improvement efforts where they’re needed most.
3. Improper Space Planning
But just selling your church isn’t your only concern–you must have a plan for your new space as well. Is your new church bigger than your previous property to accommodate a larger number of parishioners? Or is it smaller to reflect the trend of small and manageable congregations? Do you have the funding to furnish your new building with the appropriate lighting, ventilation and sound systems? Does the layout and structure of your new building reflect the preferences of your community?
These are all considerations that must be taken into account when moving into a new space. Your organization may stand to make a tidy profit from your church transaction, but this revenue may be wasted if your new location requires an excessive redesign to meet the most basic of your parishioners’ needs. Make sure that the space you’re moving into fits the goals of your organization without needing to break the bank on cosmetic redesigns. Many newer buildings have lower upkeep costs related to maintenance and utilities than older buildings, giving you a head start when assessing the best way to turn a profit on your transaction.