Thursday, August 15, 2013

33 Guidelines to investing in real estate...................

Guideline #30:  Don't sell the little piece before you sell the big piece.

Real estate often has various components.  A five acre lot can easily be divided and sold from an 80 acre farm that has a decent amount of road frontage.  The fixtures, equipment, and licences can easily be sold from a closed restaurant or bar.  The timber can easily be sold off of a wooded tract of land.  And so on.

Peoples' needs and motivations vary, so this is not a "never do," but it is a "really think hard about it" type of guideline.  There are times when it makes sense to sell a small piece to protect the big whole.  But, more often than not, "cherry picking," or selling the small piece at a good price, seems to negatively impact the value of the remainder.  Diminish the value of the remainder enough and you devalue the entire investment.

Think it through.

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