Stay in or get out...that is the question

Viewing 4 posts - 1 through 4 (of 4 total)

Gus_2
Member
@gus_2
Join Date: 2002
Post Count: 39
April 17, 2003 - 8:35 am
Well guys it’s time for me to seek some friendly advice. I’ve got an investment property (eastern suburbs of Melbourne)in partnership with family members that we have been renovating with a view to selling on completion. We needed to acheive a certain price to breakeven and at this stage (3 months on the market)we have got close, but no cigar as they say in the classics. I guess the decision before us is – sell and make a loss now, but get back into the market and make some money somewhere else OR hold the property, find a tenant and get the rent and depreciation benefits to help meet our repayment obligations, and sell when the market picks up. It is a good 3brm house in a good area. Has anyone out there been in a similar situation and have some relevant advise for a couple of first timers? []
I’m sure people will have an opinion re renovations and costs etc, but what I would like to hear is comments about the sell or hold options before us? Alternatively, is there any other options?
Thanks in anticipation []
AD
Participant
@ad
Join Date: 2002
Post Count: 636
April 17, 2003 - 9:50 pm
Hey Gus,
Tough one to call. Do you walk and call it a learning experience that you are much wiser from or is it the kind of property you want to hold. How does this fit with your investment goals ? Do whatever brings you closer to your desired goal. Remember that if you are looking at break even you could wrap the property and sell at a small premium to market enabling you tomake a profit out of the deal.
Hope this helps.
Enjoy
AD [:0)]
(Andrew)
“”Imagination is more important than knowledge. Knowledge is limited. Imagination encircles the world.”
Albert Einstein
Paul Dobson
Participant
@pauldobson
Join Date: 2003
Post Count: 1,196
April 17, 2003 - 11:07 pm
Hi Gus
I’d recommend, if you haven’t already, doing some research on selling the property via a “wrap” or a “lease/option”. Using either of these two options should get you into a positive cashflow situation now.
All the best, Paul
Paul Dobson | Vendor Finance Institute
http://www.vendorfinanceinstitute.com.au
Email Me | Phone Me
An alternative way to finance your home.
Gus_2
Member
@gus_2
Join Date: 2002
Post Count: 39
April 18, 2003 - 9:14 am
Thanks for the feedback. With regard to wrapping (which I have never before attempted, but want to learn how), is this ideally suited to homes at the lower end of the capital value continuum – say under $200K? The property in question is priced to sell around the mid $300K mark? Does the price tag make it prohibative to do a wrap deal?
Gus[?]