All Topics / General Property / Selling Success!

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  • Profile photo of Steve McKnightSteve McKnight
    Keymaster
    @stevemcknight
    Join Date: 2001
    Post Count: 1,763

    Hi,

    Please use this thread to discuss the topic of selling property as highlighted in the November newsletter.

    Regards,

    Steve McKnight

    **********
    Remember that success comes from doing things differently.
    **********

    Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
    https://www.propertyinvesting.com

    Success comes from doing things differently

    Profile photo of brcbrc
    Participant
    @brc
    Join Date: 2002
    Post Count: 63

    Well, I’ll go first. When I think about selling, my first thought is….don’t. A dear old friend of mine, weeks before passing away told me that one of his biggest regrets was selling his riverside apartment in Brisbane instead of keeping it. He sold it in the early ’80s before riverside apartments were even ‘the thing’. He could have kept it and built his retirement home, but he sold it preferring not to be a landlord. He had another 15 years to watch the price skyrocket.

    Years later, when thinking about selling my first property, I stupidly talked to a real estate agent about it, who (surprise surprise) recommended selling it. The offer came in on the first day it was listed and with dollar signs in front of my eyes I grabbed it. I’ve had 4 years to watch that property more than double in price. Yeah that was through the boom, but booms come along every ten years or so. I had the property for 6 years. I remembered my old friend’s advice but ignored it as ‘old timer thinking’.

    If it is a decent property (that’s why you bought it right?) and you can afford to keep it, do so. You’ve only got to go and find another property anyway, plus pay tax, listing fees, potentially lose tenants (who don’t like staying when a place changes owners).

    _____________________________
    We all need somewhere to live – but do we all need a CBD apartment?

    Profile photo of DazzlingDazzling
    Member
    @dazzling
    Join Date: 2005
    Post Count: 1,150

    Assuming you intend to leave your money in the asset field and don’t go and purchase a great big bag of lollies with the proceeds, selling to me is akin to jumping from one investment vehicle to the next, as you travel along down the road of wealth.

    Makes sense I suppose if your old jalopy is stuck by the side of the road with two flat tyres and the opportunity arises to hitch a ride in a Ferrari zipping along the road to wealth at a great clip of knots….assuming the clown in control isn’t driving you into a ditch and you don’t have a hand on the steering wheel !!![bike2]

    Our group likes to drive down the road of wealth in a convoy of large road trains, rather than hundreds of little Mini Minors. Because of this, the cost of ditching one road train and jumping into another one is very expensive…like a couple of Mini Minors type expensive…so we simply don’t do it. Driving road trains through the traffic also has other advantages, where potholes and minor traffic jams become less of a concern. 10-4 rubber ducky !!!! [biggrin]

    I suppose the last time we sold, back in ’97, we were driving Mini Minors. I’ve posted the below in another thread, but thought it appropriate to explain why we don’t sell any more.

    **********************************************

    For the benefit of those interested, I’ve distilled a 75 day process ;

    1. House put up for sale.

    2. Neighbours make an offer directly with agent during first home open. Full price. Their names and address clearly shown on contract. Finance, white ant and building inspection conditions attached.

    3. Offer accepted by us. Very happy after the massive amount of work and hours put into the property.

    4. Time lapse of 30 days. Under offer sticker on sign. All enquires cease or told “it’s gone” by agent.

    5. Offer withdrawn – due to white ant clause – “walk away clause”. Both we and the REA completely floundering by this stage.

    6. We’d just spent 26K and 3 months fully renovating, which they knew, being next door. Not a white ant within cooee of the place.

    7. 20 more days pass.

    8. Offer received, 16K less than asking price, from a “and/or nominee” from a mystery buyer via a conjuncting agent that our agent had accepted a 60/40 deal without our knowledge.

    9. Our agent knew the mystery buyer but decided not to inform us.

    10. After much encouragement from the REA, we accepted offer…not happy with the $, especially after the neighbours offer was fresh in our minds, but were sick of the whole deal and wanted out.

    11. Nine (9) days before settlement, mystery buyers … nominees … reveal themselves in the settlement documents from the purchasers settlement agent….surprise surprise…the very same lovely people from next door.

    12. Flurry of emails and letters to all parties, REA shrugs shoulders and said “At the end of the day you signed it, nothing to do with me”.

    13. Property settles and we walk away with 16K less 2 months after we should have settled…but with a whole bunch of lessons under our belt.

    I look back and think now about the overall lessons we learnt ;

    1. We are the investors. All authority / responsibility / risk and reward rests on our shoulders. Don’t blame REA’s or purchasers or lawyers or friends or anyone else. If you’re not 100% happy and fully understand what’s going on and everything is transparent, don’t sign.

    2. The REA has not a jot of influence or power in the legal property transacting process. They are a mere bystander and we do not rely on them at all nowadays.

    3. Contract isn’t a solid contract until all of the Mickey Mouse clauses are removed and it’s unconditional cash on the table.

    4. Haven’t sold a property since.

    ****************************************

    Steve, not sure if that was what you were looking for ??

    Profile photo of fernfurnfernfurn
    Member
    @fernfurn
    Join Date: 2005
    Post Count: 139

    If one has decided to sell, should I sell in the next six months or hold for another year and then sell, hoping I guess that the slump has finished and prices will have moved up by then.

    Fern

    Profile photo of brcbrc
    Participant
    @brc
    Join Date: 2002
    Post Count: 63

    Fern

    As they say in the share market, bottom pickers get their fingers dirty.

    If you want to sell, do your sums on realistic outcomes and not hopes and dreams. If the property is costing you money each month (mortgage payments, rates, body corps?, insurance) realistically how much more are you going to get in 12 months time? If you get $10,000 more in 12 months, is it going to cost you $12,000 in holding costs?

    If it is a positive geared property, and not costing you anything, why sell?

    I’m trying to decide at the moment whether to buy a place or not. Should I buy now, or should I wait for 12 months to see if prices come down further? In the end nobody can predict the future so you have to make your best judgement and go for it.

    _____________________________
    We all need somewhere to live – but do we all need a CBD apartment?

    Profile photo of MarkyMarkMarkyMark
    Member
    @markymark
    Join Date: 2003
    Post Count: 132

    I think the decision to sell or not can be taken back to the same old question I ask myself 10 times a day these days. Will it get me closer to my goals by the specified time or not?

    I am faced with this same question at the moment. I have chosen not to sell even though I have profit in the deal. The reasons that I am not selling is,
    a. I have a plan for the property, i.e it is a good development site so there is still profit to unlock
    b. Im getting an excellent yield, so holding costs are low
    c. My position on the market for this particular area is that I don’t see prices dropping from where they are now as they are still undervalued in comparison with other similar areas close by.

    So I have used this as a bench mark. If anything I think it has a little further to go. But im not counting on it nor do my plans hinge on it.
    d. The associated debt is well under control and affordable even with considerable greater interest rates

    I must say the main reason is that there is more profit in the deal and I can use that to get closer to my goal. If it was a stand alone house with no further potential accept capital gains then I would sell now and lock in profit.

    But if the property was on like Brisbane river and I got it at a good price then I probably wouldn’t sell (as to me this has further potential), I suppose I would try to solve the problem (maybe cashflow) while keeping that property.

    I could be wrong about point C, but then I need to take a position so that I can make a choice. I think its better to analyze the situation as best you can and then choose, as apposed to keep going um… errr…. and then something happens and your forced to sell at an undesirable time.

    Cheers,
    MarkyMark

    Profile photo of marsdenmarsden
    Member
    @marsden
    Join Date: 2004
    Post Count: 112

    I think that the most important consideration when the ‘buy/sell’ question comes up is what the property market is doing. You may have to decide if you will make money on the proposition, whether it is to buy or sell! As an investor, you are operating to make money on your IPS–What happens to you own home is a completely different matter. Clearly, if you can sell a property and make more money by putting it in a bank account, you should sell. When the decision is not that clear cut, you decision will be tempered by all the elements affecting the investment.
    However, the state of the property market is not brilliant and, while it may suit some bottom feeders, many investors will find it easier to invest elsewhere for good return in the foreseeable future!

    Profile photo of belindazollobelindazollo
    Participant
    @belindazollo
    Join Date: 2003
    Post Count: 2

    I have been thinking of off loading one of my properties in the south east area of Melbourne near the beach, but have since decided against. However, I did come across a great selling concept in this area. Called Owners Choice, this is the only self sell concept whereby the vendor can get their property on realestate.com and domain.com. The fee of $2750 is on a no sell no fee basis and the remaining agent fees, of more than $10,000 in my case, go straight into your bank account. I believe this business is operating from Frankston up to the CBD at this stage but is growing fast due to the massive savings vendors make. Check out http://www.ownerschoicerealestate.com or email me at [email protected]. I may be able to answer a few queries.
    Hope this helps

    Profile photo of aldertonalderton
    Participant
    @alderton
    Join Date: 2003
    Post Count: 1

    It seems to me that alot of the discussion assumes that you have already made a gain on your property. I bought mine two years ago, unfortunately at the end of the boom. I intend to hang onto it an stick to my plan. Property prices will increase.

    I kept reading people saying “be in it for the long term” when I was thinking of investing. Now very few are saying this.

    I’m not selling.

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