Tough times come knocking without notice. What do i do? Should I sell my investment property or keep it? This is a question that most real estate investors face at some point in life. It can always be handled but first read this story (true story…)
“A property mentor of mine once talked about his battle with this decision which I found very interesting and very helpful. He was at a point in his career where he was working for a church and didn’t earn a lot of money, but had a few investment properties on the side. He also had a car loan that he had to pay every month and he was struggling with his finances. He couldn’t afford to pay everything. His thought was “I should sell my investment property because it’s gone up in value and then use that money to pay off my car so that my expenses goes down. Wah! Good thought as I will clear the car loan.” He then went to one of his mentors and a financial adviser and said “I’m thinking about selling of my property and clear my car loan, what do you think?” They really talked and his Mentor said look, why are you sell this property which is increasing in value and actually generating a positive cash flow for you? and worse still you want to pay off a depreciating asset like a car which is going down in value over time? This really changed his mind set and helped him to understand that what he thought was smart wasn’t actually smart. That’s what I want to help you today and help you through this though process.” Always sell your properly as a last result.
Tips to help you in decision making in the real estate.
- Appreciation rate
Keep an eye on property prices, replacement prices and rental levels. Look at the interest rates variations, population growth and the projected population migrations. Let your money grow you as the asset is intact and only sell it whet is very critical. Real estate in Africa doubles every year.
- Maintenance cost
if you own freehold property that means you do not have to pay for the yearly land rates. With this property you have zero maintenance cost as all you need to do is to hold your property and you watch it gains in capital growth.
- Bank security
In case you need money urgently Use your Title deed as a security for a Bank facility. You will be cushioned at your time of need and your property will still gains capital growth. You can also use it as a security for working capital for your business.
- Sell and reinvest somewhere else with great potential
Sell only if you are Re-investing somewhere better with great potential.
You can also sell if your property has gained capital growth and you need the finance to develop a bigger investment.
Invest today at http://www.optiven.co.ke