Decide Your Exit Strategy Before Buying Investment Property
That’s right, when using property investing to create wealth, each and every investment property purchase should have an investment property exit strategy outlined before the purchase takes place.
You might ask why would an investor do this. Well, everything you purchase in life has an end date.
Think about it! Whether you buy a bottle of milk, a nice soft bed, a new car, a boat, a holiday, a new dress, each and every purchase at some stage has an end date.
The logic of it tells you that at some stage the purpose of owning a particular investment property is going to come to an end.
The end could be heralded by any of the following:
the completion of a renovation
a change in the planning laws which means there will be a railway going near the property and will devalue the property
the property needs a lot of money spent on it to upgrade it but property values in the area have not moved that much and the extra dollars spent may not be returned at a profit
your financial circumstances change and you need to off load some real estate
you have become ill and cannot deal with property investments very well
You can see that there could be a huge list of why an investor might sell a particular property.
An exit strategy is all part and parcel of building a property investment business plan so that you are prepared in advance, for a change in circumstances regarding any property.
Having a list of exit strategies means that if you do make a decision to sell the action has been properly thought out and is not an action taken carelessly.
All actions in property investment portfolio building should be actions taken after careful consideration of the past, present and future and the best way to do this is to have everything documented down, well be purchasing.