Are you thinking about selling? Best to consider these factors and avoid the following traps.
1. Profit has been maximised: When a property has reached maximum value, there is little value in holding onto it for longer. Therefore this is generally considered the optimum time to sell.
2. Property has not performed: Having cash or equity tied up in an investment that has not performed (over a reasonable time period) can prevent an investor from reaching their financial goals.
3. Better opportunity elsewhere: Investors should know how each of their properties are performing relative to a) others in their portfolio and b) those in the market place. If another opportunity presents itself with greater investment prospects then it should be considered.
4. Depreciation has been maximised: Depreciation on a property lasts for up to 40 years from the time of construction. Over time the value of depreciation recedes. This could weaken a property's cash-flow position to the degree that it becomes better to sell.
While a forced exit can cause investors to panic and make easily avoidable mistakes, there are a number of traps that any investor wanting to exit a property needs to be aware of, according to experts.