Tips On Selling Your Investment Property When Looking To Gain Profit
Real estate buyers purchase their chosen properties for varied reasons. There are those who simply want to hold on to the ownership of the house as summer or vacation homes, for example. On the other hand, there are also those who invest in these properties for them to eventually sell them and earn a profit. If you belong to the latter, here’s a guide to help you gain the best profit for your investment property:
- Open up your investment property for an Open House.
An Open House is that event where you open up your doors to potential brokers and buyers. These buyers and brokers need to see homes that are up for sale for them to put a good price on their possible purchase. To make things even easier for you, you can take advantage of technology by posting your property up for sale on Open House websites, so you can possibly sell investment property online as well.
On the upside, too, an Open House is an excellent way to increase foot traffic into your home. When you see that the demand is quite low, an Open House is an excellent way for you to actually strengthen and create a market for real estate property in your community, as it allows a competitive effect to form in your local area for visitors that come to see your home.
Another advantage of an Open House is that you are also allowing yourself to meet more potential buyers. Hence, you aren’t only limiting yourself to a very few. Who knows—on one of the Open House dates, a prominent investor might walk in with an excellent offer.
- Before selling, convert your investment property into your personal residence.
When earning a profit is your goal when you decide to sell your investment property, you will want to make the most out of every dollar earned, and every dollar deducted as well. One of the deductions out of the sale of a property is in taxes, such as the Capital Gains Tax. This tax amount usually is the highest out of all the tax deductions from your potential sale, and this amount in unavoidable. However, there is a way for you to decrease the tax that will be charged to you.
Real estate brokers will most likely advise you to convert your investment property first into your personal residence before you sell it. Turn this house into a home. Personal homes that are up for sale are charged with a lower capital gains tax, for the very reason that you aren’t selling commercial property. This amount of deduction usually varies, depending on how long it has been used as a rental property vis-à-vis that of your personal home. So, plan your sale strategically.
- Timing is key.
You’ve heard that all-too-common maxim so many times already: timing is critical. Before you put your investment property up for sale, take a good look around the real estate investment market if now is really a good time for you to do so. No matter how great your property is, if the demand is weak, then you will surely have a hard time selling it at a price that will allow you to earn a substantial profit.
When you decide to sell your investment property, you will most likely be dealing with a broker that can help you. This broker is instrumental in helping you take advantage of hot real property market demands so that your sale eventually doesn’t turn lemon.
- Show statistics to your buyers.
When buyers walk in your home or are interested, do not just show them the physical look of your house. Go above and beyond this duty as the seller by providing them with potential growth and income projections as well. For example, if the buyer plans on using the same as a rental property, give them a ten-year forecast of their return on investment and profit earned. If the buyer plans on using it as personal property, give them the same projection as well of the appreciation of its value.
When you do this, you can achieve the following:
- You are convincing buyers to really give a resounding “Yes” to your investment property.
- When there are numerous positive feedback to your property, you can allow for better bidding, such that you can gain more profit from your sale of a higher price.
Selling an investment property to gain a potential profit is not always an easy thing to do. There are numerous steps for you to complete, and master, to help ensure that you really have the best deal from selling your home. You wouldn’t want to make the mistake of selling your home haphazardly and having a poor deal from it. With these tips, you are better assured of your property reaching its highest and best potential.
Image by Oberholster Venita from Pixabay