A client came to me wanting an assessment of their property portfolio.
They had a portfolio worth about $2 million that they’d been building for nearly a decade.
I suggested they should sell one of their properties.
Property A:
Purchased in 2017 for $420,000, recently valued at $820,000. Total growth of 95.2% or 10% per year.
Property B:
Purchased in 2016 for $640,000 and currently valued at $1.2 million. 87.5% total growth or 8.2% per year.
Property C:
Purchased for $380,000 in 2015 and now valued at $550,000. Total growth of 44.7%, or 4% per year.
I told the client they should get rid of property C.
While it’s done OK, it’s actually underperformed the others and the overall market by 50% over that period of time.
Bad assets don’t get any better.
Plus the opportunity cost to hold them is massive.
I suggested they should cut their losses and go out and find a property with more upside potential.
Do you agree?
Engaging a trusted buyers advocate through Henderson’s buyers advocacy service is your best chance at navigating the competitive real estate market.
