We did it! It is 2022 and after six years of owning this house, we have sold it. It was our first ever house, one we lived in for four years, and our second rental. Although I intended to hold this property for decades, back in November, after review of the current market conditions, we decided it was time to sell.
How I Decided It Was Time To Sell…
The marketplace pretty much told me…Currently in Florida, as in many locations in the U.S., it is a strong seller’s market, with relatively low days of supply and more buyers than available properties. Competition among buyers is high, and therefore, so are prices. As a result of the current market conditions, my wife and I knew that we could sell relatively easily at high prices while possibly getting multiple offers well above asking.
Secondly, I knew that in the next year or two, I would be on the hook for some extensive capital expenditures in the form of new air conditioning system and new roof. If I intended to hold long term (greater than 5 years), this would be no concern, but since I knew I was ready to sell, I would essentially sink money for little additional value to the sale price. Hence, we decided to list it.
We listed the property at $250k, nearly double what we paid, and within days, we had multiple offers (greater than 10), most of which were above asking. When it was all said and done, we closed the sale for double what we paid in 2016. What a blessing🙏🏾… Does this make me smart? Not so much.
In Good Markets
In good markets, you do not need to be so smart or intelligent to make money. It does not take skill to ride a wave that the whole world knows exists. We happened to buy at a time when prices were relatively low, the Space Coast market was relatively unknown and not yet driven by population growth as a result of new jobs, and there was not a sellers market as there is today. We bought the house as a primary residence, however, recognizing that it would be a long term investment. We believed that eventually we could sell it at $200k, but not for much more and that it would be many years from that point. This is what happens when inflation occurs.
What Causes Inflation
Asset prices go up… As a result of COVID-19 and the government printing, dollar values began to decline as inflation resulted, and that same inflation drove prices of real estate and stock market values. Since the COVID relief (up until current the turmoil in Ukraine), we have been riding a wave of strong asset performance.
How to Invest In An Uncertain Environment
Does all of this asset excitement? My guess it does not for too much longer (as we enter a new phase of the economic cycle), but we have yet to see. However, here are some things you should know…
1️⃣ Investing in assets is always a good thing…
2️⃣ Be wise and do not overpay, even in ”hot” markets…
3️⃣ Invest with the long term in mind; sometimes (as my example above) you will be pleasantly surprised and can cash out….
More to come on each of these thoughts in future posts!
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Rodney Robinson II