If you own an investment property in Vancouver or the Tri-Cities area and you know it’s not the best investment for your money, why are you keeping it there? There is no rule in investment property that says you must stick with the same property once you’ve invested in it. In fact, there are times when the local market here in the Vancouver area makes doing that a mistake.
How to Read the Signs About When It’s Right to Sell
Start with looking at what you are actually making
Before you do anything, you need to sit down and do your due diligence with the numbers. Start with looking at your annual income from the property. This is different than monthly income and should include all the upkeep costs, losses due to vacancies, and maintenance. Take a single month of rental income and assume it stays that for 12 months straight to get your base annual income and subtract these expenses from that to see what you are actually making. If you aren’t making at least 1% of what you paid for the house each month, then you probably need to consider selling the property. For example, if you paid $100,000 and aren’t able to secure $1,000 in rent after costs deducted, you should consider letting this property go.
Next, consider how much time you put into the property each month to make this amount
Most property investors have full lives outside of their investments. This requires much of their time and attention that an investment property shouldn’t cut into – or at least a good one shouldn’t. Evaluate how many hours you spend each month and whether or not that is fulfilling to you or it’s getting in the way of other things. Bottom line, if an investment property is sucking up all of your free time, it’s probably time to look at letting it go.
Are there issues with the tenants?
Sometimes it is just hard to find good tenants for a particular property. This can spill over into both issues we already covered: how much of your time the property takes up and how much income you can secure as vacancies between high turnovers add up. You need to take a critical eye and evaluate the property: is it because the property is rundown or is it just a neighborhood with issues? If it’s the property, you perhaps can fix that, if it’s the area it is in, it is probably best to think about selling the property.
Next, examine how you really feel about the property.
Stress is real. We don’t need more of it in our lives. Sit down and think to yourself, Do I get a knot in my stomach when I think about this property? It might manifest itself differently, but the point is that some properties, for whatever reason, become headaches. You have the right to be free from this and to instead be excited about your investment property. Stop dealing with a home you know you don’t want to deal with. Do yourself a favor and sell it.
One quick point, often people hang onto homes that cause them the kinds of stress we’re talking about here because they inherited them. Something about an inherited property can make us feel obligated to hold onto it. But you need to assess your life – if it’s costing money, draining your time, or causing you stress, it’s time to let it go.
Last reason to consider selling? Your money could be making more for you somewhere else
Not only are there other properties, but there are other ways to invest. Always keep as many options for your investments open as possible. Look in other areas outside of Vancouver, perhaps someplace you’d like to spend more time? The point is, great investment opportunities come and go all the time, but they don’t hang around for long. Missing out on something big because your money is tied up in a property you don’t want anyway doesn’t make a lot of sense.
Never forget Summit Development is a quick and easy option to liquidate your investment property.
Summit Development proudly serves homeowners and investors in Vancouver (360-667-5424) and the Tri-Cities (509-591-9196) with a variety of services designed to help them make the best possible decisions about selling their home. We buy properties as-is without the need for an agent or listing fees. We finance our own deals, so there is no loan approval process to deal with. If you have a property and want to know what we’d offer for it, give one of our offices a call today.