Was wondering after going through the world economy thread, whether it makes sense to sell your flat and cash-in as the rate in the market is good currently and wait for an opportune moment to buy. Let's all discuss on the merits and demerits of the same as well as the case (in my instance) where the flat was the only flat that you owned.
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  • Originally Posted by arunnath
    Was wondering after going through the world economy thread, whether it makes sense to sell your flat and cash-in as the rate in the market is good currently and wait for an opportune moment to buy. Let's all discuss on the merits and demerits of the same as well as the case (in my instance) where the flat was the only flat that you owned.


    What most members in the world economy thread in this forum are saying is don't over leverage on loans like taking huge home loans, which in the time of a crises could be harmful. Don't spend more then one can, don't borrow too much planning to pay off from future earnings for another 20-30 years. (Future earnings is only a speculation that all will be well in future and same economic conditions would prevail as during good times).

    Please don't consider this is something like buying or selling a stock. It is a big decision for thousands of families.
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  • whether it makes sense to sell your flat and cash-in as the rate in the market is good currently and wait for an opportune moment to buy.


    Pretty dumb idea, if you are living in this apt.

    Buying and selling will cost 18% in stamp duty (9%+9%). How are you planning to break even taking this into consideration?
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  • High risk is such a game
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  • But will that not depend on how much it has accrued till date and how much it could fall tomorrow?
    In any case thanks, had no idea that i had to pay stamp duty while selling, need to understand the functioning of these transactions.
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  • Originally Posted by arunnath
    But will that not depend on how much it has accrued till date and how much it could fall tomorrow?
    In any case thanks, had no idea that i had to pay stamp duty while selling, need to understand the functioning of these transactions.


    Note that you will pay stamp duty and registration charges only when you buy. If you sell, the buyer will bear the charges. But you will have to pay income tax on the profit you may have made by selling your flat. If you make the investment in real estate, then you can overcome that..Auditors can give you more details on income tax..
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  • Originally Posted by arunnath
    Was wondering after going through the world economy thread, whether it makes sense to sell your flat and cash-in as the rate in the market is good currently and wait for an opportune moment to buy. Let's all discuss on the merits and demerits of the same as well as the case (in my instance) where the flat was the only flat that you owned.


    Nop. It's not a wise idea, that too in curremt scenario.
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  • Questions you should ask before you decide whether you would want to sell or rent out your second property:

    Will the cash flow?

    Here consider whether keeping the property and renting it out will be a profitable move or not. How? Simple math. Know the expenses you are making on the property every year and then take the rent you are asking for throughout the year. Are you making money or spending more than you get? This is how you would get to know whether you should rent or sell this property.

    Can you handle tenants?

    If you are in a different city, it could be difficult for you to handle tenants living in a different city. You cannot visit them every now and then or resolve any issues for the tenants because you are not physically present there. Moreover, for someone who is already dealing with pressure at work, it might not be easy to handle tenants and the issues that arise at his property in Pune.

    In case you are in the same city and can dedicate time for the property, find tenants and take care of the paperwork, you could rent the property.

    Can property fetch you a better price in future?

    What if your property is located in an upcoming real estate market where the prices will soar in another five to seven years. It is advised that you wait for the market to open and then sell the property at a profitable cost. Till then why don't you rent the property if you can handle tenants?

    Can you maintain two properties?

    Be prepared for double maintenance expenses and also more house tax. Moreover, the travel expenses are additional, in case you live in a different city. In case you are planning to give the property on rent, consider all these areas. Every time a tenant vacates the property you will have to run certain repairs in the property and over the time it will also undergo wear and tear. If you can handle the expenses because you want to keep the property, renting is a viable option.
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  • Hold on. Resale market is not high as the buyer needs to pay 11% on sale value towards registration costs. Means the seller needs to trade off the per square feet rate.
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