When to hold and when to sell?

2 Replies

I am curious to see what strategies other investors use to determine when it is time to sell off some of their rental properties.  I don't mean when you need cash, or emergency situations, etc.; but at what point do you look at the numbers and say" time for this one to go, this one stays, etc...?

One of the real estate strategies that was taught to me was that you get all repairs, big and small, done in the beginning, roll it into the financing, and then sell after five years (supposedly when things start to fail and need repaired/replaced).  I would imagine there are many other strategies out there and I want to know more about them.

In general, when you have added value to a property to the point where your incremental gains in value will generate returns on your capital in the deal that are below your target ROI (about 5% to 8% per year for me), it's time to start thinking about selling.

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