Buy now, sell in 10 years?
“I’ll buy an investment property now, hold it for 10 to 15 years, then sell it to pay off debt and help fund my retirement.”
I’ve heard versions of this quite a few times recently.
And I can understand the appeal.
Buy while you’re still earning good money. Hold the property through your remaining working years. Then sell around retirement, pay off the debt and use what’s left to help fund the next stage of life.
It’s a strategy that can work.
But there’s one thing I think is worth asking:
What happens to your retirement plan if the property doesn’t perform as well as you expect?
Maybe the capital growth is lower than expected. Or perhaps the property market happens to be weak when you want to sell.
There are also selling costs and potentially capital gains tax to consider before you know how much will actually be available for retirement.
None of this means property is a bad investment.
But I think there’s an important difference between owning an investment property and having a retirement strategy.
Property can absolutely be part of the strategy. I just wouldn’t want the whole plan to depend on one property, one future sale and one assumption about what it will eventually be worth.
A good retirement strategy shouldn’t depend on everything going according to plan.
It should give you some confidence about what happens if it doesn’t.