Tips
Selling in a Down-Market
We expect this trend to continue for
at least 3 to 4 more years. So unless you have to sell,
don't contribute to the existing oversupply (see chart
above). Real Estate has always been and always will be one
of the best long term investments available. However if you
have not noticed yet, it is a highly illiquid and volatile
market. If you don't have the money or the stomach for a
strong correction, you should not be in real estate.
Here a few rules for
sellers:
1. Investors, is your cash
flow positive or negative? Do your math
and budget until 2010 and 2011. If you have a negative cash
flow, you will have to add up all your costs and put it on
top of your purchase price just to recoup your cost. Raise
rents as soon as market allows you to.
2. Moving - should you
keep or sell? Ask yourself:
Do you want to become a long-distance landlord? Like in most
cases, the answer is no - logically price it to sell. If you bought within the
last two years and need to sell now you might be upside-down
or in other words, you might owe more than what your home is
worth (See article: Short Sale).
3. Up- and Downsizing: In
a down-market, the longer you wait selling, the more your
equity will melt away. Time is of the essence here. Buyers
had an upward moving rollercoaster for over 5 years -
now they are enjoying the downward ride. Put yourself in
front of the train to meet the buyer - avoid to run after
the train by pricing your property high and lower it little
by little.
More questions on pricing? Call me
directly at 786-287-6999 or write to
info@ibmiami.com
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