The primary purpose of an investment property is to generate wealth, so when the time comes to cash in or switch strategies, selling becomes necessary.
With property costs on the rise, many investors are opting to sell their properties. While your Professionals property manager can assist you in managing costs, there are important decisions that need to be made.
The first decision revolves around the tenants: should they be asked to vacate, leaving the property empty for sale, or should they be allowed to stay until the deal is finalised? To make an informed choice, consider the following factors:
Selling without tenants:
- Make upgrades before listing: If the property requires repairs or cosmetic fixes, asking the tenants to move out allows you to make the necessary changes on your own schedule.
- Market appeal: An empty property presents better in the market, as potential buyers can more easily envision themselves in the space.
- Flexibility: Without tenants, scheduling open houses and private inspections becomes easier, accommodating the preferences of potential buyers.
- Easier exchange: Waiting for the tenants to vacate simplifies the settlement process, especially if the buyer intends to occupy the property.
Why sell with tenants in place?
- Financial considerations: Asking the tenants to leave would result in a loss of rental income, so it’s important to consider if you can cover the cost of an untenanted property during a potentially lengthy sale process.
- Increased expenses: Vacating tenants may require relocation costs or compensation, depending on local regulations and lease agreements.
- Time to vacate: If the sale is urgent, selling with tenants in place may be more practical than giving notice and waiting for them to move out.
- Buyer profiles: Some buyers may prefer an investment property with existing tenants, which could facilitate a faster sale.
Ultimately, the decision to sell with or without tenants depends on your personal circumstances and the advice of local property experts. It is advisable to consult with your real estate agent and property manager to discuss timelines, property condition, and how the tenants will accommodate a sale campaign.
