To sell or not to sell

Discussion in 'Investment Strategy' started by lynchy, 16th Mar, 2020.

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  1. lynchy

    lynchy Well-Known Member

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    Hi all,

    Looking for some advice. I bought a 3 bed unit in Dee Why in Feb 2019 for $930k, currently about $900k owing, high lvr due to small deposit and guarantor from parents

    Given the Corona virus and economy in general we are considering selling. I value our pace at $1.1 to $1.15m but the agents have come through and have said $1.2 to $1.3m...typical agents I guess but it’s possible. We got lucky when we purchased in that it was, almost by the day, the lowest point in the quick dip.

    We love the location were in and we love the apartment, albeit a bit small. The only thing I don’t like is the 1 to 1.15hr commute to the CBD in the morning. My GF works in Avalon so all good for her

    We are in our very early 30s, combined income of close to $300k base with bonuses so while we’re not under financial stress my fiancé is in the retail industry and I work for a property developer and both industries are susceptible to a failing economy

    We don’t have a lot of buffer given a year in London in 2018 and our wedding this coming August so we’re considering selling and renting for the next 12 months then reassessing.

    I guess the lack of a buffer and the thought of living almost wage to wage until our wedding in August (big expensive Greek wedding :rolleyes:) is playing on my mind

    Our repayments are about $3,800 P&I pm. We’d be looking at spending $3,000 - $3,800 pm on rent if we were to sell.

    interested to hear peoples thoughts
     
    Last edited: 16th Mar, 2020
  2. Trainee

    Trainee Well-Known Member

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    Just remember you will have to factor in rent, stamp duty when buying later etc
     
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  3. Jess Peletier

    Jess Peletier Mortgages, Finance & Property Strategy Aust Wide Business Member

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    Cancel the wedding - it's the perfect excuse right now to elope ;) Buffer sorted! :D
     
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  4. lynchy

    lynchy Well-Known Member

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    Haha I wish. The Greek parents in law would kill me
     
  5. Mumbai

    Mumbai Well-Known Member

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    As trainee mentioned above consider the costs.

    You bought for $930k and paid stamp duty, legal fees, interest so far on top of it. Assuming you would have also spent a bit on furniture, moving, decorating, etc.

    Now you are going to spend on selling agents' fees, legal fees and moving again.

    Do the math and take the decision.
     
  6. lynchy

    lynchy Well-Known Member

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    Had 3 groups through

    1. underbidder when I bought it 12 months ago, offering $1m
    2. Not clear
    3. Australian Chinese have asked for a contract

    looks like I’m holding
     
  7. Shazz@

    [email protected] Well-Known Member

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    Only you can make this call-
    I just did some rough calculations:
    Stamp duty + legal at a purchase price of $930k = ~$45k
    Selling cost (assuming $1.2 mil) = ~$30k
    Cost base base is now 930+ 45+ 30 = $1.005 mil
    Profit after selling ($1.2 mil) = ~ $195k
    Not bad after 1 year as you won’t pay any capital gains.
     
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  8. Ummm

    Ummm Well-Known Member

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    Highest offer so far is 1mil... just because you and the person trying to get your business tells you it's worth more doesn't mean it is...
     
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  9. Shazz@

    [email protected] Well-Known Member

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    I was going off best case scenario.
     
  10. lynchy

    lynchy Well-Known Member

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    Selling costs are 1.4% inc GST. I work with the agent through the developer I work for so getting a good deal

    Lowest we’ll take is $1.15m. Will see how we go during the week!
     
  11. VDK

    VDK Active Member

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    Wish you luck - you might be wishing you took that $1.15m!
     
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  12. lynchy

    lynchy Well-Known Member

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    Haven't been offered that yet! Only offer is $1m from the under bidder from when I bought it 12 months ago. Wouldn't surprise me if it's a bit of a psychological hurdle for her to go so much higher after just 12 months

    Not holding out much hope but doesn't make any sense to sell for less than that
     
  13. FredBear

    FredBear Well-Known Member

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    If you sell for $1M you are only $5k behind. Look at it this way: you have had a place to live for a year that has only cost $100pw. That's much cheaper than renting something similar.
     
  14. lynchy

    lynchy Well-Known Member

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    Group 1 has made it clear they will not go above $1m
    Group 2 has offered $1.05m this morning
    Group 3 has withdrawn. They have a requirement for a lockup garage and ideally attached to the building. I've only got a carport
     
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  15. wilso8948

    wilso8948 Well-Known Member

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    I think you are making long term decisions off a relatively short term problem.

    If you love where you live then stay?

    If you want to live somewhere else then take the offer and leave?
     
  16. kaibo

    kaibo Well-Known Member

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  17. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    I was pretty certain in the new Corona Economy, weddings are limited to 5 people - the couple, the witnesses and the celebrant? or am i missing something?
     
  18. whiteknight

    whiteknight Well-Known Member

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    Hi Lynchy, can you please provide an update on this? Did you end up selling? :)
     
  19. lynchy

    lynchy Well-Known Member

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    Hi!

    Ended up with an offer of $1.1m but we were steadfast in not selling for less than $1.15m

    The difficulty is that there are very few places we prefer between the $1m and $2m range more than where we are currently so we would have been selling for the sake of selling

    We'll wait it out until we can afford to buy in the $2m to $3m range
     
  20. Archaon

    Archaon Well-Known Member

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    Have you refinanced the guarantor off the loan as yet?