How Long Are You Planning To Hold On To The Property?
If you are planning to add property as part of your investment portfolio, how long are you planning on holding on to it? Have a good tenant is a key to a successful rental. The longer they stay in the property, the better.
How long should you hold on to the property? The answer is it depends.
- If the property is paid for, any thing net from the rental is yours to keep. I would keep the property as long as you want.
- How old is the property? If the property is old in that you may need to spend money to maintain it, you might want to look at the numbers. If it is going to cost you a lot of money, you might want to consider selling it and buying something newer. If the property is older but have been remodeled or the major mechanical component have been replaced then it would be worth to keep it for a while.
- What is the intend of this property? Some folks buy a rental property as an additional way to save for their kids college fund. Another strategy in case your kids does not need the college fund and you don’t want to be penalized for not using your 529 college savings. In another words, the property is like your 529 College Fund with flexibility of doing what you need for.
- If you are looking to hold it long enough to make money for when you sell it, then get with a local Realtor to see when is the time to sell. This varies by location, area and most of all the economy. Calculate what you bought, spend and can sell for minus Realtor fees to determine if you should sell or keep.
Remember, this is all about numbers. How long do you hold the property depends on the situation.