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  • When to sell

    Hi there, some advice please and thank you in advance.
    We have a rental property in central Auckland. It's on a good street and it's a legal home and income bringing in $1,875. week. We are wanting to pay off debt and are thinking of selling. We were looking at doing this at the end of the year but one of our tenants have given notice, so we were thinking is it better to try and sell now? Things to consider is our mortgage is coming off next month and the rate has more than doubled. If mortgage rates continue to climb would it be best to try and sell now, as well as if there is a slight downward drop in house prices?
    So what are your thoughts please? Thanks again =)

  • #2
    Ideally, you never sell - just leverage off your assets. It's a bear market in real estate - prices are dropping so it's not the best time to sell. If you can hold onto your assets - do it.

    Are you using a property manager? Is the property cash flow positive (after expenses there's some profit)?

    cheers,

    Donna

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    • #3
      Thanks for your reply Donna.

      Due to ill health my husband has had to retire earlier than planned, so we figure now is the time to sell something and free up some cash. We still have two other rentals but this one will pay off all our debt and give us some spending money (or a deposit for something else).

      We manage the properties ourselves. Yes it's cashflow positive but even with the pension it's still not quite enough as we want to start enjoying some of our money now.

      Just trying to decided when would be the better time to try and sell, now or at the end of the year.

      Thanks.
      Last edited by Perry; 08-05-2022, 05:56 PM. Reason: fixed typo

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      • #4
        Originally posted by stellar View Post
        Due to ill health my husband has had to retire earlier than planned, so we figure now is the time to sell something and free up some cash. We still have two other rentals but this one will pay off all our debt and give us some spending money (or a deposit for something else).
        Sounds all very reasonable, to me.

        Originally posted by stellar View Post
        Just trying to decided when would be the better time to try and sell, now or at the end of the year.
        You do have to 'wing it' and decide for yourself. It really is anyone's guess.

        However, you have a thought-through plan with appropriate rationale and if prices change (either way) once you've sold, so what? Such has no impact on your present plan, apart from a speculative windfall gain / loss of some sort.

        Just in case what remains of hubby's health deteriorates further, get on with it and live for the now.

        Remember that Fate is what happens when you least expect it.

        I don't want to be thoughtless or grim, but after the sudden loss of a spouse some years back, I came to realise, acutely, that "life and death is what happens when you're busy making plans."

        Have faith in your own plan[s].
        Want a great looking concrete swimming pool in Hawke's Bay? Designer Pools will do the job for you!

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        • #5
          Hi Perry, thank you for your comments and honesty (and sorry for your loss).

          What you've said makes a lot of sense and I totally get what you're saying.

          I guess as this is the first time selling something it's quite nerve-racking and so we're second guessing ourselves. Especially with prices dropping it goes against what we know we should do, which is hold on.

          We have done very well out of that property though as we've held it 23 years now. So yes, your right, the gain or loss by selling it now won't matter in the big scheme of thing and it means we can move on.

          Thank you =)

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          • #6
            Prep for sale too with a deep clean, paint, change flooring and stage for sale - we did that on a property we’d had for 17 years and it was worth it. We also changed the loo, oven, added a dishwasher - oh and added bark around small shrubs - it came up really good and made a big difference to the profit.

            cheers
            Donna
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            • #7
              Thanks Donna, we were wondering if we should sell as is or spend a bit more money and time on it to try and get a higher price. We refurbished one of the places early last year and the other one maybe 3 years ago so both are pretty good internally but maybe the outside lets it down a bit. We have a meeting booked with a real estate agent for an appraisal so that will be interesting.

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              • #8
                Yeah, first impressions - get it off to a great start. If you think its exterior lets the property down - then buyers will too. We spent $20K and I reckon it added an extra $150K (but our IP really did need the full monty inside and out). We did the work ourselves - and took 3.5 weeks.

                Let us know how you go.

                cheers,

                Donna

                SEARCH PropertyTalk, About PropertyTalk

                BusinessBlogs - the best business articles are found here

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                • #9
                  Thanks Donna.

                  Will do.

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