When it comes to buying or selling property, don’t let panic or passion be the driving force behind pivotal investment decisions. Rushing into things can be a good way to shoot yourself in the foot, according to the story of one property investor.
Falling head-over-heels in love with a property or rushing the sale of an investment are two ways property investors can get “stitched up”, Krys Drysdale, property investor and real estate agent, said on the Smart Property Investment Show.
The now real estate expert fell victim to both when he was working in the mines of Queensland, making his first property purchase in the coastal suburb of.
Mr Drysdale said: “We had first home buyer’s grants back then. And my wife and I, we purchased that, fell in love with it.”
“That was the worst purchase I’ve ever done, the worst decision I’ve ever made. I paid $425,000 for it at the peak of the market,” he added.
The property comprised a small wooden house, which sat on a divided block, so the plot of land was skinny and long.
“We got stitched up,” Mr Drysdale said. “The real estate agent stitched us up on the sale and basically made sure they got everything out of us possible, because we were emotionally invested into that home.”
“I mean, if I knew what I know now and going forward, I certainly would have ran from it,” he added.
Mr Drysdale owned the property for six years before he was made redundant, which prompted him to rush the sale of his property, this time using a different real estate agent – only to be stitched up once again.
According to Mr Drysdale, the real estate agent who sold the property would have been “rubbing his hands together with glee” and sold the property well below market value.
“He just didn’t bother trying, really,” Mr Drysdale said.
“He just knew that I had to sell it, or felt that I had to sell it.
“Unfortunately now though, in hindsight, I didn’t really need to sell it at all. Everything was fine, it was just a panic sale.”
Mr Drysdale sold the property for $430,000 six years later, just $5,000 above the price he purchased it for.
He had been locked into a principal and interest mortgage, which went cash flow positive and, as such, was not out of pocket.
“I just didn’t want it hanging over my head... I think interest rates, we were worried that they were going to go up at that point, and it was just bad,” Mr Drysdale said.
He added that it was a panic sale that was not necessary, given the fact he had “a bit of money in the bank” and no pressing need to liquidate.