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Empower Wealth Blog post by Empower Wealth

Why Now is NOT The Time to Sell Your Property

We’ve been catching wind of investors offloading their properties lately. With the surge in interest rates, it’s entirely understandable.

However, are there alternative avenues for you?

Watch this short video to discover the happenings during past crises and why holding on to your property might be a wise move to steer clear of potential future regrets.

And should you seek seasoned and qualified advisors, we’re here to assist!

Empower Wealth extends an invitation for a Free and No-Obligation Initial Consultation, allowing you to undergo a Finance Review without incurring any charges. Click here to Learn More >

Additionally, if you’re uncertain about your cash flow holding up, explore MoneySTRETCH on Moorr here >

(Related video: 3 Crucial Tips Before Selling Your Property! – Watch here)


Bryce: Back in 2000, I thought that property investing was going to stop because we had the introduction of GST. And so you remember the tax rates dropped so much that everyone looked at the each individual property and thought, actually I’m not positive cash flow anymore, I actually I have to put in $5, God forbid, $10 at the time.

So remember the collective energy at the time was property investing is not going to work after GST because no one’s going to invest in property.

And now we look back some 23 years later and go, it kinda make sense that it was still going to continue. And the fact that if you hadn’t have been in the market looking back now, you’d be really disappointed versus those people who were in the market now and kept for the long term. Looking back, it’s been pretty cool.

Ben: I mean, I can go right back Bryce. Negative gearing, ‘85 to ’87. And then they reverse that so, you know, it’s not going to work then and they work it out.

And then to your point, Year 2000, the GST.

Then the GFC (Global Financial Crisis). Oh my God, the whole financial market system is going to break and that’s going to obviously flow into property prices. That didn’t happen, did it?

And then, you know, then you had the election where they were talking about banning negative gearing and then we had the QLD Labor Government introduce a land tax reach where they wanted to charge you for the value of your land held interstate from Queensland. That got squashed.

But these sort of things come and go right?

Bryce: Well, we haven’t even mentioned the pandemic, which was the biggest property panic in memory for most people. So I guess the point that we’re trying to raise here is there’s always been a reason why there’s a time to not enter or to get out.

And I feel really concerned now that a lot of people are saying, okay, we’ve had a very tight interest rate cycle, the tightening cycle, so people are rightly so, checking their household finances.

But I think what I’m concerned about is the easy option is to say.

“Let’s sell (our property)”

Because it’ll give us immediate pain relief. But the problem I’m worried about is if we fast forward 10 years, 15 years down the track and people actually look back at this moment in time, I’m worried a lot of people will have regret that they made the decision to choose easy now and have hard later instead of choosing hard now so they have easy later.

Ben: Mate there are two types of regret in property. The first regret is never buying or not buying when I could have bought, you know, so they look back and they go urgh.

But the other big one, and this is the one we’re focusing on right now, is Seller’s Regret.

Because people are going to look back in a decade or two and go, “Why did I sell that property?”

Why did I sell that property?

And we’re seeing it in the data right now because I also heard anecdotally through connections and also through our business, some people aren’t just selling one property, some of them are selling two or three properties.

Now there’s tax considerations as part of that. Next year from the 1st of July 2024, the tax rate drops down to 30% for most people, so some people are paying in the 40% range. So that’s significant. So timing issue in terms of why you would sell it. You’re going to be paying higher taxes, and there’s a capital gain tax and if you’re selling them all in one financial year.

So our message is dig in, but also get some advice.

Bryce: Now is not the time.
It’s no different to negative gearing abolishing.
No different to 2000.
No different to 2008.
It’s no different to the pandemic.
It’s no different to what you just said about Queensland.

This is just another external environment that gives you an opportunity to say, I have a longer time horizon than most people, so I want to stay in the game a bit longer.

Now is not the time to sell.

Ben: Well households are looking at their finances and they’re going what can go, you know, and then probably not going, well, the holidays are important that sort of revenge travel that I need to post-Covid. That’s staying.

All of the other discretionary things that we’ve now started to enjoy. They’re all staying.

So they’re selling an appreciating asset. I prefer to sell a car. That’s not a depreciating asset and try and hold onto the property as much as possible because that’s what’s going to be the problem.

Have you Reviewed your Loan recently?

As mentioned in the video, please get professional advice before you decide to sell your property. At Empower Wealth, we’ve had this discussion with a lot of clients, mainly due to the significant increase in interest rates and while there a handful that do need to sell their property, majority of our clients were able to hold on to theirs. This is done by having a full understanding of their cashflow position and a comprehensive lending review to make sure their loan structure works for their unique circumstances.

So please speak to your Bank or your broker if you are feeling the pinch from these rate rises. And if you would like a second opinion, our national multiaward-winning mortgage team would love to help with a Free Finance Review. It’s completely free to use a broker to review your loan so why not get some qualified and professional advice before you sell your property? And of course, once you’ve had the review, there’s no obligation to engage us as well.

If you’re interested, simply fill in the form below to get started on a Free Finance Review.

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