What you do with a dud property. How do you know if you should sell or hold, with Brett Warren

You invest your money to give yourself the highest likelihood of reaching your goals. But how do you know if your investment is actually helping you reach your goals?

And what do you do if your investment properties are underperforming?

That’s what I’m going to discuss today with Brett Warren, and our conversation will be informative for both new and experienced investors.

Then, in my mindset moment, I’m going to share some advice from Bill Gates.

Are your properties achieving the results you were expecting?

Will it get you where you want to get to?

The first thing to understand is what your overall strategy is and how the property fits into that strategy.

Then you need to know whether the property is performing as expected and whether it’s outperforming the market.

Ask yourself if you would buy the property again if it were on the market today.

Are there improvements that you could make to the property to increase its value?

How is the property going to perform going forward?

Ask yourself why you chose this property – often because it was recommended by someone with a vested interest.

Where are the locations that will outperform?

• Places where people have multiple streams of income and more wage growth
• Gentrification
• Infrastructure
• Livability and amenities – people will be prepared to pay a premium to live in places where they feel safe and comfortable, especially post-COVID-19
• Good investment properties need multiple pillars. Just one of these factors isn’t enough.

4 Reasons why properties under perform

• Timing – bought at the top of the cycle
• Price – paid too much for the property
• Location – if the location is under performing, the property will be as well
• Property – poor selection, something wrong with the property

If the timing or price was wrong, but the property is right, it might just be a question of waiting. But if the property isn’t going to improve in value, it’s time to sell.

Links and Resources:

Michael Yardney

Metropole’s Strategic Property Plan – to help both beginning and experienced investors

Brett Warren - Metropole Property Strategists

Shownotes plus more here: What you do with a dud property. How do you know if you should sell or hold, with Brett Warren

Some of our favourite quotes from the show:

“I think it’s important to understand what motivated them, what their thoughts were when they chose that particular property.  ” –Michael Yardney

“We frequently say it takes the average property investor 30 years to become financially independent, that’s because in the first 10 years you make all those mistakes.” – Michael Yardney

“If you can only own 2 or 3 properties, you’ve got to own the best ones you can.” – Michael Yardney

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