Leasing your condo can be a good decision to make if you wish to keep earning from it. However, you should be ready to face the challenges and costs associated with it. Certain situations warrant selling off a condo, and this article highlights six of such situations.
Situations when you should sell your condo
- A decline in Monetary Value
It would be better to sell your condo if its monetary value tends to decline with time. Despite a rising margin in the real estate industry, a lessor can only claim a fixed amount for their condo, depending on the previous amount charged. If this previous amount is much lesser than the prevailing rent, he or she may consider selling it off to avoid loss.
The process of leasing a property can be very tedious and involves lots of paperwork. It may involve advertising and maintaining the condo. As a lessor, you should expect to go through this process more than once. Also, dealing with difficult lessees can be a frustrating and expensive venture. To avoid this stress, most people hire a leasing company or put it up for sale.
- Physical value
The location of your condo can affect its value. If your property does not stand the chance of appreciating, you should consider selling it off. A condo located in an area that attracts lots of people or where many other condos are being sold can have a promising rise in value. This way, the cost of refurbishing it to raise its value can be foregone.
- Distance Challenges
Distance is a good reason to sell a condo. If you are moving from your condo to a distant location, it is better to sell, as this will save you time and money from traveling down to the location. Owing to the distance, you may have to hire a property management company to take care of the property till you meet the next lessee. All these would be unnecessary if the property is sold.
- Unfavorable Government Regulations
In different locations, the government has certain rules that oversee the leasing of properties, including condos. These rules could either favor the lessor or the lessee. Some of these rules can affect the return on investment a lessor can make on a property. Where there are heavy taxes and restrictions placed by the government on the lessor, selling off the condo will be the better option.
- Excessive Cost
While you are still searching for who to lease your condo to, you are responsible for its maintenance, insurance, and advertisement. Leasing your condo doesn’t assure immediate return on these expenses. Also, a lessor does not enjoy some benefits like sales tax and duty concessions. Situations like this can warrant high costs, hence putting the lessor at the losing end. At this point, the lessor can sell the house.
Selling off property may appear to be the worst financial decision ever. Six of these reasons are stated in this article. These reasons can help you decide if you need to sell or lease out your condo.