The Hidden Costs of Holding Out: Why Waiting to Sell Could Be Costing You More Than You Think
When selling a property, the urgency to close can vary greatly depending on your situation. If you’re living in your property or enjoying a steady stream of rental income, the pressure to sell may not feel immediate. But when the property is vacant, every day it remains unsold starts to chip away at your bottom line in ways that many sellers underestimate.
Let’s break it down:
Real Estate Taxes: These don’t disappear just because your property is unoccupied.
Insurance Costs: Even an empty house needs insurance—against fire, theft, or that unexpected natural disaster. It’s a necessary safeguard, but one that continues to drain your resources.
Maintenance and Repairs: A vacant property doesn’t maintain itself. Whether it’s keeping the garden tidy or addressing that leaky faucet, maintenance costs are a constant, unpredictable burden.
Utilities: Lights, heating, water—these basics still run, even in an empty home.
HOA Fees: If your property is part of a homeowners association, those fees continue to add up.
Mortgage Payments: Your old 2% mortgage rate might sound like a steal, but when there’s no one living in the home, it’s just another monthly expense eating into your potential profits.
Cost of Capital: This is the often-overlooked wildcard. Let’s say selling your property nets you $500,000 after all is said and done. In today’s market, that sum could be earning around 5% annually—roughly $2,083 a month. That’s money you could be using to generate income or fund new ventures.
So as a property sits vacant, look at the taxi-cab-meter ticking away as each month passes and calculate the COMPLETE costs to carry when evaluating offers. Understanding the full scope of your carrying costs can help you make more informed decisions and ultimately lead to a more profitable sale.