Contributed by Nathan Birch – Investor and co-founder of Binvested
HOW TO GET THE MOST FROM SELLING PROPERTIES
As I mentioned in a recent post, I have been selling properties to make way for better opportunities to get me to my goal of being a billionaire by 40.
The properties I am offloading have performed well for me – there’s no denying that.
Ideally, I don’t like to sell properties, but if selling a few lets me leapfrog to bigger and better things then it’s a no brainer.
EVERYONE’S SITUATION IS DIFFERENT
Just because I’m selling a few doesn’t mean the market is turning. Far from it!
There’s still plenty of growth left in existing properties, and good opportunities to buy ones.
However, you need to consider what it right for you? Should you make small consolidations in your property portfolio now in order to open up new opportunities for yourself?
If you would like help working through your situation then get in touch with the Binvested team.
TO SELL OR NOT TO SELL?
The main question you should ask yourself when deciding whether or not to sell is this – What will I get out of this?
If selling will help you come closer to achieving your end goal sooner, then it’s definitely an option to consider. It’s like selling some little green Monopoly houses, to un-mortgage Mayfair and place a hotel on it.
On the other hand, if you are trading in a house on Bow St for to buy one on Vine St, it won’t change much for you. In this case selling may be an expensive waste of time and possibly opportunity – for example think of the capital gains tax and selling fees!
WHAT TO SELL?
Again, this depends on your own situation and goals.
Do you want to pay down debt and close your books? Do you want to grow your portfolio even more?
What properties do you have? Have they accumulated equity? Is there room to grow or will growth slow?
Or, maybe, you have undergone a development project and would like to sell to generate more capital and borrowing power?
THINGS TO CONSIDER
There are several things to consider if you want to get the max out of your property sale.
KNOWING THE MARKET
You need to have a good idea of what properties are worth and what can add to their value.
You need to know where they are in the cycle, and what changes like rezoning are on the horizon.
You agent should know this too, however if they don’t then you know right away they are not the right one for you.
KNOW THE BUYER
Knowing the buyer can also make a huge difference. If the property is likely to appeal and sell to another investor, then selling while the property is tenanted will be a bonus.
If you are likely to sell to a homeowner, on the other hand, selling during a lease may turn buyers off the property. Instead, it may be worthwhile to end the lease and stage the property with nice furniture.
REAL ESTATE AGENT
It is important to choose the right agent to sell your property.
I recently picked up a property on the Gold Coast for $622,000. The owner had purchased this property 15 years ago for $600,000.
At the time of my purchase, I was told by other local agents that the same property was worth $1.4 million to 1.6 million. The house wasn’t it the greatest condition but it had been rezoned for unlimited height buildings. This meant it was worth far more as a development site.
The vendor missed out on making twice the amount he paid for it because the selling agent was terrible at their job.
You don’t want this kind of agent to sell your property!
What to look for when choosing a selling agent:
– Choose one who has the biggest market presence, so they deeply understand the market.
– Choose a strong one who will represent you, and guide you in order to make the most profit
– Choose one who can show strong results, not just quick sales but high sales prices
– Choose one who who will do what is takes to get good results and is not afraid of hard work
GET PUT IN TOUCH WITH AN AWESOME SELLING AGENT
Finding a great agent is not always easy, that’s why I am willing to put you in touch with the agents I personally use to sell my properties, and the agents I trust to get the best return on a sale.