The decision to sell an investment property is best made with a local commercial real estate broker. A broker has a better understanding of how the community around your investment property changes. They can give you the most accurate information as you weigh your options.
There are many reasons real estate investors decide to sell commercial properties. There isn’t an exact timeline that states how long you need to own an investment property, and the decision is ultimately yours. Regardless of your reasons, choosing to sell is a big decision. Today, many people are looking at the real estate market and asking if it’s best to hold onto a property or sell it. We’re covering the top reasons investors sell commercial properties in today’s market.
It’s common for businesses and the properties surrounding the community to change. As the community around your property grows and develops, the changes attracting patrons will change the needs of your tenants. Assess the changes and how they affect the value of your property as you consider selling the investment property. Your property values may increase as the surrounding area improves.
While it may seem counterintuitive to sell a property when you have long-term leases from great tenants, you may find the pool of prospective buyers increases when you have a property for sale with great tenants already leasing.
If you’re in an area where the demand is high for the type of property you own, you may find that a low inventory of listings increases your rate of return on your investment. Business owners looking to own rather than renew a commercial lease or companies looking to expand a local presence may be facing a time crunch to purchase. This could be the perfect time to sell your real estate property.
Investment properties will require repairs and upgrades over time, including a new roof, upgraded HVAC system, flooring, and new windows. Do you have the cash flow for the repairs, or will it take years to earn back what you invest? Can you increase the monthly rent after repairs are completed to offset costs? If your local broker has active buyers looking for a commercial property to remodel, you may find it’s better to sell than invest in major repairs.
If your life circumstances are changing, this may be a good time to sell your investment property. Are you planning for a comfortable retirement? Are you moving, making the management of commercial leasing more challenging? Are you consolidating streams of income? Regardless of your financial situation, you may determine you’re no longer interested in the responsibilities of commercial property ownership. In these scenarios, it is the perfect time for you to sell.
Do you have a passive income from dividends, bonds, crowdfunding, CD, online business, or royalties? Once built up, these sources of income can greatly exceed that of certain investment properties. Selling your investment property may free up time and resources, which allow you to grow other passive sources of income.
At Ullian Realty, we understand that deciding to sell your investment property is a big decision. With over 50 years of combined experience, our real estate team knows Florida’s Space Coast. Our team understands the needs of the local market and will work with you to sell your commercial property when the time is right for you. Give us a call to discuss whether this is the best time for you to sell your commercial property.
Editor’s Note: This post was originally published in 2018, but has since been updated for accuracy and freshness.
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