So we get it that you’re upset you missed selling your property 5 years ago when it was worth considerably more. We speak with people all the time who express this feeling. “Five years ago my property was worth (considerably more than today) so how can I sell it now for (considerably less) and lose all that money plus what I paid in taxes? I think I’ll just hold on to it until prices come back.”
But isn’t that the same thing you probably said during the last downturn and yet still didn’t sell when the market was up five years ago. You see land prices, as well as all real estate, goes in cycles. An up – down cycle is about 8 – 12 years with the down part usually lasting about 5 years.
Instead of trying to time the market and hit the next peak of the up part of the cycle, why not take advantage of the opportunity that is staring you in the face right now. And what is that you ask? Well . . . not only has your property fallen in value but so has everyone else’s around the country too.
It seems apparent now that in most places, and prices are very regional, that land prices have bottomed and some are starting to rise. Since everything is down from five years ago that means land is on sale everywhere. If you sell now and take the money you get and use it to buy, or as a down payment, on a bigger, better property, won’t you come out ahead in the long run?
For example, let’s say you sell your property for $3,000 today, well below the $20,000 you bought it for – OUCH! But then you take that $3,000 and use it to buy a $5,000 property, twice as big as yours or in a better location that once was worth $40,000 or more – YEAHHHHH. For such a tiny additional investment you’ve basically doubled your money or bought a property in a much better location.
Now this is just a hypothetical example but those kinds of deals are out there. Instead of bemoaning your loss, use it to take advantage of the opportunities that are there if you look for them. And remember, selling at a loss may be eligible for a tax deduction too but please check with your tax specialist to review your personal situation.
Opportunity knocks – don’t miss it.