Top Tips For Deciding To Sell or Rent Your Property
It’s fair to say the property market can feel like a minefield at times.
Everyone has their own piece of advice, but what is right for your situation may not suit the next person at all. This blog will highlight some key things to consider when tackling the decision of what to do with your existing property when the time comes to move on – to sell or to rent it out.
Think With Your Head, Not Your Heart
This step is easier said than done but it is critical to making smart and informed financial decisions. Firstly, take a step back and try to understand why you are considering the options at hand.
We often see couples that have lived in the one property for many years looking to downsize and keep their existing home as an investment. Their family has grown up in the home and they have strong connections in the area. But when we get to the crux of why they are considering holding on to their family home in the first place the reasons are far more emotionally based than financial. This is dangerous territory and can lead to poor financial decisions.
On the other hand, a range of circumstances can lead to homeowners rushing into a decision to sell. Without proper market advice and a thorough understanding of their individual financial situation, this may not be the right decision either. Essentially, knowledge is power and being properly informed can do wonders for your financial decision-making. With more than 1,000 offices across 11 countries, Ray White has a property specialist in your area that can help you make the right decision for your situation.
Consider Your Cash Flow
It’s true, holding on to an investment property could give your financial situation an injection in the future or could present sizeable tax breaks but what about your cash flow in the meantime? Keeping your situation manageable is often a very viable financial decision. If your investment is dependent on the projected rental income from the property (which is often the case) any number of things could impact this revenue. It’s important to consider things like maintenance costs and upkeep, possible body corporate costs and council rates depending on the property or what if the property is vacant for a period of time for whatever reason. All these things could impact the viability and manageability of your investment.
The Investment Itself
Ask yourself this, why did you buy your home in the first place? For the majority of people, buying a family home is not solely a financial decision. Most people take into account the neighbourhood, locality of family and friends, schools, work etc. While these things may impact the investment potential of your home, in most cases they won’t. This means by selling you could theoretically channel your money into a property with far more investment potential than your existing home.
On the other hand, if you have strong, reliable information (not just a gut-feel) that the area is set for amazing market growth then by all means, the benefit of turning your home into an investment may outweigh the associated risks.
Are you more confused then ever? Here are our top considerations when deciding whether to rent or sell your existing property:
- Always, always, always leave emotions out of the decision
- Understand your own financial situation like the back of your hand
- Understand your market and consult a Ray White professional for advice
- Explore all options before ruling anything out
- Could you see yourself moving back into the property in the future?
Whether you are looking to rent, sell or buy consult your local Ray White professional today. Our agents are here to help you make the right financial decisions for your future.