People sell investment properties for many reasons. So how do you work out when’s the best time to sell?
There are several things to consider when deciding whether to sell your investment property and when is best to make a sale. Taking a good look at your finances and housing market forecasts can help you decide whether to sell or if you should hold off.
The speed to close the deal might be your most important consideration if you’re under pressure to complete the sale to free up money. It’s worthwhile understanding your financial picture to inform your decision.
Getting a true picture of where you stand financially could make a big difference to the outcome of a sale. Taking time to get your head around the numbers will help you understand:
After doing the numbers, you might have the opportunity to sell your investment property, without looming financial pressure driving your decision.
Looking at average house prices in your area can give you a rough idea of what price to expect for your property.
It’s a good idea to check out how quickly sales are being completed and prices properties are selling for in the suburb where your investment property is. It can help to get a hold of the latest auction and home sales results or get local real estate agents to do an appraisal.
Your local council can give you information on planned infrastructure developments.1 Schools, shopping centres, new roads or rail links can contribute to higher property values. If you decide to sell, include information about new infrastructure when marketing your property. This can help paint a picture of what life could be like for your buyer.
Depending on your timeline, you can use this information to decide whether you should sell now or hold off until projects are finished which might result in better returns.
It’s a good idea to keep a close eye on trends in the market from interest rates to supply and demand to know if you are buying or selling at the right time. Real estate insiders often refer to ’cooling’ and ‘rising’ markets — but what’s meant by these terms?
A cooling market could be considered a buyer’s market. Buyers might be able to get the house they want for a lower price, but sellers can generally expect less return on their property compared to a rising market. If you’re selling in a cooling market you might need to be more open to negotiating with your buyer to get the sale over the line. You’ll can be more certain on how low you can go if you’ve done your numbers.
These are a few indicators that you’re in a cooling market:
A rising market could be considered a seller’s market, meaning you may be able to score a higher price for your property at auction if you’re selling. On the other hand, sellers could face more competition and pay more than planned when looking to buy a house.
These are a few indications you’re in a rising market:
Changes in the property market could impact the success of your sale if you sell in a cooling market. Here are some tips for selling in a cooling market.
Do research to find an agent with experience selling in a downturn. Explore marketing strategies they have used before to get buyers interested in a cool market. Do they have a long list of active buyers they can contact? Look for an agent that understands that you need to be creative when marketing the property.
Understand the market and know your numbers. Buyers may negotiate more aggressively in a slow market, so set realistic price expectations. The price you achieve should not be a surprise if you’ve got a good agent who is upfront on what to expect.
Be prepared to put in effort and money to spruce up your property so potential buyers see it at its best. You want to make a great first impression. Painting the exterior and tidying the front garden go a long way in making a good first impression.