As an investor, knowing when to sell real estate is just as important as knowing when to buy it. Your investment property should be making you money, but should you find you are putting more in than you are getting out, perhaps it’s time to reconsider. Dean Graziosi has provided some useful tips that will help you know when the time is right to put your investment property on the market.
Is your property vacant? All too often, real estate investors purchase a property only to find it isn’t bringing in the rent money they first thought it would. When this happens, you can either assess the repairs that should be made and pay for them, or think about selling. The problem with a vacant property is you will probably wind up taking a loss. Should this occur and you have no choice but to sell, as an article posted on SFGatepoints out, you can turn your loss into something positive by using it to reduce your overall tax liability.
If you own property that is not in the same area or state in which you live, it can be very difficult to maintain from afar. Odds are you have someone looking after it for you, but even this can result in significant headaches. If you find the upkeep on a property you can’t actually look after yourself is becoming too much, you might consider selling and purchasing something a little closer to home.
How many renovations do you need to make? In a perfect world, it would be possible to make the necessary modifications and changes to a property as you go along. This is certainly possible if you receive a steady income on it each month, but sometimes those renovations can get quite costly. All too often it’s easy to put them off with the intent on taking care of them next month or even next year. As time marches on, the need for those renovations will grow. Sometimes the cost of performing them is more than you the investor can actually afford. When this happens, it’s time to sell. You will probably take a loss for your property, but at least you can offload it to someone who can take care of the renovations. Should this occur, save your money and purchase another property that doesn’t require as much work.
If the area where your investment property is located has declined, it may be time to consider selling. It’s always possible residents will come together in an effort to improve the location, but sometimes desirable neighborhoods become undesirable and not much is done to change them. When this occurs, prospective tenants will shy away from moving into a home located in the neighborhood.
The decision to sell your investment property can be a difficult one, but by better understanding the market and your own personal real estate investing needs, you can make a well informed decision. You can learn more about real estate by visiting Dean Graziosi’s blog.