How to Build a Property Empire: Selling Your Property Portfolio
The final step – selling your property portfolio – won’t necessarily be for everyone. While many investors will be looking to hand their portfolio down as an inheritance, it’s true that some investors may be looking to sell their portfolio.
It should be noted that property investment always suits a long-term strategy and selling over a short-to-medium timeframe can mean missing out on maximising returns. It’s always an option to hold on to property as long as possible, especially as the gap between supply and demand continues to grow.
If there does come a time when you’re looking to sell then your options depend largely on the size of the portfolio.
For landlords with several properties, these can typically be converted back to ‘traditional’ residential houses that can then be sold on through an estate agent or bought by another investor.
If you’re a landlord with a larger portfolio – say 10 or more – your best course of action is usually to sell to another landlord. Whether you go through your own network to a private buyer or sell via one of the many landlord-to-landlord services out there is down to you.
Similarly, if you’re selling a portfolio with tenanted properties there’s other factors that should be taken into account. If a landlord is selling a tenanted property portfolio, they’ll typically do it off-market. However, you still need to consider:
- Why are you selling in the first place?
- Do you want to sell your properties together?
- Are your properties up to legislation and fully-compliant? Do they need maintenance work?
- Is the rent you’re currently charging appealing for any new buyers? Is it competitive?
- Did you buy through a limited company? If so, the sales process will be different.
Selling a portfolio is never easy but provided you’ve got good foundations and can demonstrate steady returns, you put yourself in the best position to appeal to other investors.
This is why it’s always a good idea to track and measure your past performance. If you’re looking to sell a portfolio, understanding what it can offer and potential for the future will make it much easier to sell – especially if you’re going through a landlord-to-landlord service.
The final major consideration for any investor selling a portfolio is the tax implications – mainly Capital Gains Tax. It’s always best to speak to a financial advisor, giving you a good idea of how you can mitigate costly sales fees down the line.
Finally, consider that building a Buy-to-Let portfolio through a limited company will affect the sale process. Your ‘exit plan’ should be a huge consideration when considering incorporation, as selling during retirement through a company is much less effective than holding it for relatives, for example.