Sell underperforming 1 bed IP & Opportunity cost ?
- Thread starter Alex P Keaton
- Start date
I was going to get the agents to go and do a valuation first.
I'll discuss with my PM. I'm a little pissed that my pm didn't mention anything about how the tenant was thinking about moving out! No wonder she took so long to sign the lease. PM said she hadnt signed because she had been on holidays. I dont understand why PM wasnt truthful.
Anyway when I let the tenant know im selling the ip maybe she would be keen to move on sooner than when the lease expires in August. What do you guys think I should do, or what options/tips do you have for this situation? I need to do q quick crash course in selling ip 101.
Ask the agent first and see what they say before deciding. Specifically asking if it was better to be tenanted rather than vacant possesion.
Oh I dont think I asked this question specifically although my pm agreed with the real estate agent in waiting till June to put it on the market because that way there will be a bigger pool of buyers to choose from!
I spoke with my pm just before and told her to tell the tenant I was putting it on the market. Also she said that the tenant just hadn't got around to signing the lease and that's why it took so long. She said the tenant signed for 6 months and said she will reconsider if she will stay on after 6 months. I guess I will wait and see what the tenants reply is.
Also real estate agent # 1 rung up my pm and got the tenants details/phone number to arrange a time to come view the property. PM will hopefully get in touch with tenant before the ra does. I'll email pm to talk with tenant ASAP.
The thought crossed my mind for a bit. I'm not sure though she could afford a mortgage as she only works part time & study's too plus she has a small child. But you never know maybe her parents might help her out with the deposit & or go gaurantor or something. It's worth asking hey. Good idea, I'll do it.
It's just something agent # 2 said. He works for the same company that my PM works for so maybe there is a reason they want to make me wait till June!? Maybe it's less hassle for them that way.... Ulterior motive, I dunno. The real estate agent seems to think fhb will make up the majority of buyers for my property and I guess he feels they won't want to wait till August to move in when the lease expires.
Hi, I've been offered 2% commission which is a discount as I've been a client of hers before having bought my highgate property. How does that sound? That works out at about $5000.
I'll be meeting the real estate agent on Wednesday, to have a discussion. Real estate agent thinks its best to sell before it gets too cold and wet as during winter people tend to stay away and sales slow down as its cold and rains. She says values have picked up a bit since January when the other units sold. There is less stock on the market so I'll have less competition. I was on the mark with her appraisal.
I wonder what will happen to my management agreement with my PM. Does the PM cancel it? Do I cancel it. What do I do? I'll have to have a talk with pm when I think of the questions I need to bring up with her.
Does anyone have a good link to learn about what happens when you sell? I've no idea. I've never sold before and also what happens with the pm side of things?
thanks
I'll be meeting the real estate agent on Wednesday, to have a discussion. Real estate agent thinks its best to sell before it gets too cold and wet as during winter people tend to stay away and sales slow down as its cold and rains. She says values have picked up a bit since January when the other units sold. There is less stock on the market so I'll have less competition. I was on the mark with her appraisal.
I wonder what will happen to my management agreement with my PM. Does the PM cancel it? Do I cancel it. What do I do? I'll have to have a talk with pm when I think of the questions I need to bring up with her.
Does anyone have a good link to learn about what happens when you sell? I've no idea. I've never sold before and also what happens with the pm side of things?
thanks
So there are 2 agents i'm talking with tomorrow. I'll make a decision and I reckon my ip will be on the market in the next 1-2 weeks 
I'm excited!
I'm excited!
So there are 2 agents i'm talking with tomorrow. I'll make a decision and I reckon my ip will be on the market in the next 1-2 weeks
I'm excited!
Sounds good. Will you add a link?
I'm now considering holding onto this property! The most I can make in profit is $30,000. It has a rental yield of 7 & 1/2 % so it's not costing me anything to hold. It's also not stopping me from buying this villa I'm about to buy.
Hopefully this ip will show some growth in the next few years and then I might offload it when I buy again in 3 -5 years time. If I can make a profit of say $60,000 in a few years time I could use the profit from the sale as a cash deposit for my next ip or have the cash sitting in my offset account against my ppor mortgage.
I still have 6 weeks to run with the real estate agents contract. How do I go about telling the agent I plan to take it off the market ? Any help would be good. Thanks
Hopefully this ip will show some growth in the next few years and then I might offload it when I buy again in 3 -5 years time. If I can make a profit of say $60,000 in a few years time I could use the profit from the sale as a cash deposit for my next ip or have the cash sitting in my offset account against my ppor mortgage.
I still have 6 weeks to run with the real estate agents contract. How do I go about telling the agent I plan to take it off the market ? Any help would be good. Thanks
But 7.5% is gross return, what is it really costing you pa?
Also, $30K is what you would make today, considering that it has been a rising market in Perth over the last 2 years I don't like your chances of growth, the market is now going sideways. The facts have not changed, which ever way you look at it, this property has been a lemon and that wont change. You can sit and hope for the best, but the facts speak for themselves.
Cheers
MTR
Also, $30K is what you would make today, considering that it has been a rising market in Perth over the last 2 years I don't like your chances of growth, the market is now going sideways. The facts have not changed, which ever way you look at it, this property has been a lemon and that wont change. You can sit and hope for the best, but the facts speak for themselves.
Cheers
MTR
Hmmmm, good points.
And If I hung onto it for a few more years it would be in the hope of growth. There is no guarantee there is there. Yeah I think it's 7.5 % gross, and often maintenance issues and common property expenses that come up too the latest being installing security lights.
And If I hung onto it for a few more years it would be in the hope of growth. There is no guarantee there is there. Yeah I think it's 7.5 % gross, and often maintenance issues and common property expenses that come up too the latest being installing security lights.
I purchased one lemon since investing 12 months ago, just offloaded as market was rising, saw the opportunity to get rid of it quickly.
The property was in QLD and I got the figures wrong, on paper the returns looked great 10% yield, however it took up to 3 months to rent due to client base in this area. I made the mistake of comparing this area to West Syd where rental demand is crazy high and dual occupancy is OK.
My point is it was a lemon, renting out was always going to be an issue eroding my rental returns, moved on, used the money for another deposit on a development site in Perth. Just have to be ruthless if you want the best results.
MTR
The property was in QLD and I got the figures wrong, on paper the returns looked great 10% yield, however it took up to 3 months to rent due to client base in this area. I made the mistake of comparing this area to West Syd where rental demand is crazy high and dual occupancy is OK.
My point is it was a lemon, renting out was always going to be an issue eroding my rental returns, moved on, used the money for another deposit on a development site in Perth. Just have to be ruthless if you want the best results.
MTR
I purchased one lemon since investing 12 months ago, just offloaded as market was rising, saw the opportunity to get rid of it quickly.
The property was in QLD and I got the figures wrong, on paper the returns looked great 10% yield, however it took up to 3 months to rent due to client base in this area. I made the mistake of comparing this area to West Syd where rental demand is crazy high and dual occupancy is OK.
My point is it was a lemon, renting out was always going to be an issue eroding my rental returns, moved on, used the money for another deposit on a development site in Perth. Just have to be ruthless if you want the best results.
MTR
I thought that maybe if I just hung onto it long term that property is a forgiving thing..... and would eventually grow but its just not worth it I see but nah in this case I think I agree that it's better to cut my losses sell it, start over and use the equity for something with better potential.
Tonight I'm putting an offer on a property. I don't want to say too much about it yet. I think I'm on the right track... Feels right!
Exciting times!Still trying to sell my 1 bed.
September 2014 Update
2013 - 2014 eofy Holding expenses
IP cost me $27 per week after tax to hold.
I don't have a hecs debt anymore as I paid it out from my tax refund so that's a $50 per fortnight saving.
After I get my tax return I'll have around $18,000 in savings.
My brand new villa IP that settles in October will have depreciation and will be close to neutral. I'll know my financial position more thoroughly when I see my accountant once it's leased.
I have a 3 year fixed rate on my latest villa purchase and don't plan to buy another IP for at least another 3 years.
To sum it up:
I'm thinking I will hold my Dianella for a while longer as currently I'd be lucky to get between $15,000 - $25,000 profit. It's just not worth selling when I'll make such a small profit and it's not costing me much to hold. I may look at selling when I'm ready to invest again in a few years time, or if I find I need the cash in my bank account for SANF.
I plan to move back into my PPOR in January. I'm happy
I'm happy
That's pretty much what it all comes down to.
