Deciding what to do with a property that you've acquired can be difficult, especially if the market in your area is uncertain. You've bought your property as an investment, and likely put quite a bit of work (and money) into renovating it. Sell now, sell in a few years, refinance: which option is right for you?
These options don't have a one-size-fits-all answer. However, by answering a few crucial questions for yourself, you can make a wise decision about your financial investment and how to move forward in the future.
First: how much is the property costing you to maintain? There will be upkeep expenses on any property that you have just sitting there. If you can find a way to keep those expenses minimized (by renting the property out, for example) then it's reasonable to hold onto the property until it will draw the maximum return on your investment. If those expenses begin to outweigh the potential gains, however, then it's time to start looking for a buyer. Always be aware of how much it is actually costing you to maintain a property. Don't forget to count property taxes, upkeep, and any payments that you might be making on the property.
Take a good, long look if you have a mortgage on the property, too. Be aware of current mortgage rates and whether or not it would be wise to refinance your property. If you're regularly investing in real estate, you should always know what the market rate is doing in your area. Refinancing your loan might take some of the financial pressure off, making it possible to keep your property for a little bit longer.
Next, ask yourself what your goal is for this investment. If your goal is to flip the property quickly to put the ready cash back on hand, you'll need to sell it faster (and probably put out more of an investment up-front) than if you're looking at it as a longer-term investment. Many investors consider buying property to be at least a five-year proposition. If you have the time to wait, it might be well worth it. On the other hand, if an upcoming large expense has you in the position of needing to sell, then start looking for the way to maximize your price.
Also, take a look at the real estate trends in your area. If prices have recently bottomed out, it might not be a great time to sell. If real estate has been on its way up for a while, now might be exactly the time to move your investment property (before the market starts back down again). A discussion with a real estate agent might help you to understand what the trends are looking like in your area, as well as how to best capitalize on them.
Contact us concerning your real estate financing needs, and see how Trust Deed Capital can help you make your property investment dream a reality.