Hi Guys,
I’m in a bit of a dilemma. This is my situation:
- [
]I have several IPs that I purchased for very cheap about 2 years ago and have about doubled now.- [
]They are all either cash positive or very close to it.- [
]I am thinking of selling one or two to pay off the others.. or at least have the cash there so that if the opportunity arises, I will have some money.- [}
]For some bizarre reason, they are all on fixed loans for around 5 years. (so to get out of the loan, there will be a penalty- [
]Also, it seems that the prices of houses these days in the area that most of my IPs are located, has already plateaued.Anyways, is there any point to selling it right now.. If I do, besides the tax that I have to pay on them, I will be penalised for getting out the fixed loans.[
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Also, what will be the difference if I sell and pay off or I just keep them and use the equity on the IPs to buy future ones?
What are the pro’s of selling?[?]Any comments would be greatly appreciated.
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Tomorrow, you might wish you started today.
#####################Don’t sell just to free up cash in case you want to buy another. You seem to have plenty of equity you can use for your next purchase.
By all means sell for other reasons but not this one[8D]
Looking back on the IPs I have sold in the past I regret having done so – esp with this recent boom.
Good luck,
Simon Macks
Mortgage Hunter
[email protected]
0425 228 985angie sounds like yr in a great position.
reducing your overall debt is not a bad idea.
maybe you could sell the one or two that arent performing quite aswell as the others.
otherwise sit back and watch the cash come in…
[]Hi Angie,
Is your objective reducing debt or reducing dependency of investments all in one area?
Generally I tend to agree with Mr Macks – if getting your hands on more ‘cash’ to do more investing in other areas is the aim, then use equity where possible.
If reducing your debt or reducing your exposure in one location is the objective then yeah sell just enough to feel comfortable with your overall position but make sure you understand the loan break fees and tax penalties first, may not be worth your while.
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MelThanks for your comments guys![
]I think that my main concern is that I think that the prices might be going slowing down or even going down soon. However, the more I think about it, the more I think that I shouldn’t sell.. as I will have to pay loads of tax and do not really require the money anyways. The properties are sort of positive, so I don’t really have to worry about them financially.[
]It just looked like a good idea to get out before everyone else started getting out aswell and the market is saturated with sellers instead of buyers![
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Tomorrow, you might wish you started today.
#####################Without knowing where these properties are a 100% return on your investment is brilliant, the times when people run into trouble is when they get greedy. If you are looking to sell, now is the time. If you are concerned about penalties from fixed rate loans, why not sell one now and wait a few years to get rid of the other without a penalty. I don’t like paying tax either but it is important to our society, one way to look at it is the more you are paying the more you are getting. If I was in your position I don’t know if I would sell, difficult to say without knowing someones full financial position and how much debt they are comfortable with. For me at the moment I am trying to become more liquid, because the time will come when things are very different to how they are now…..having money at the right time can be very valuable. Isn’t it Steve who says you make your money when you buy not when you sell?
Just trying to provide a different point of view.
McDeyessthanks for that comment Mcdeyees.. I understand totally what you mean. I have just heard, (don’t know if it is true or not) but units in the Sydney CBD are set to fall.. they are totally overpriced and under-tenanted… and that there should be many mortgagee sales coming in the next year or so.. should be interesting… I would like to be ready when that happens.
I guess it should not make a difference if I sell some IPs now or just use the equity later.. [
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Tomorrow, you might wish you started today.
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]I have several IPs that I purchased for very cheap about 2 years ago and have about doubled now.
]They are all either cash positive or very close to it.
]I am thinking of selling one or two to pay off the others.. or at least have the cash there so that if the opportunity arises, I will have some money.
]Also, it seems that the prices of houses these days in the area that most of my IPs are located, has already plateaued.
]
The topic ‘To sell or not to sell….’ is closed to new replies.
