Oct 22 | Posted by Barry Cohen

When it comes to selling a property that is not your primary residence, things can become somewhat complicated.  It is not as straightforward as there are a lot of extraneous factors to consider such as tenants and capital gains tax and if the property is located out of province or even out of the country the jurisdictional laws, taxes and local rules that will apply.  This is not an area that you want to venture into without trained professionals advising and guiding you from listing straight through until closing.

If you are contemplating selling an investment or recreational property in the coming year, I strongly urge you to contact a professional realtor.  Select an experienced realtor that has established a North American network of realty partners and is able to connect you with a trustworthy and reliable realtor wherever your property is located.  No matter what the distance is between you and your listed property, you will want to be kept up to date on showings, feedback, the competition and any similar properties in the vicinity that have sold.  Having a “home and away” realtor will provide peace of mind and a strong chain of communication.

Selling an investment property will likely involve capital gains tax, and it is wise to check with your financial advisor and lawyer with regards to timing before making any final decisions.   In most cases, the revenue generated from property rental is taxable, so you will be trading one tax for another, but the advice of a financial expert may save you money and help to determine the optimum time to list the property.

Another mitigating factor for selling investment property is tenants, but having responsible tenants is also a big selling factor.  If a prospective purchaser is intending to keep the property as an investment, the ability of your property to generate a fixed income is a clear demonstration of its value.  The buyer may also benefit from having a current tenant when it comes to financing, as in many cases the buyer will be able to obtain more funding when the rental income is factored into the equation.

Whenever possible, it is best to have a meeting with your tenants, or at least a phone call to communicate your intentions and show them some respect.  This is a good time to ascertain if they intend to stay on with the new owner, or if perhaps they are interested in purchasing the property themselves.  It is definitely in your best interest to have your tenants on side to make the entire process run more smoothly and possibly more profitable in the long run.  In Ontario, you must provide tenants with 24 hours written notice prior to a showing.  If your property is out of province or out of the country you will have to abide by local laws regarding how much notice you need to give tenants prior to a showing – and again this is where a reliable local realtor is a big advantage.  You must also realize that you cannot expect tenants to “stage” the property for showings, so you just have to rely on their goodwill to have the place looking tidy.

Selling property requires a highly specialized skillset that includes, accurate market value pricing, marketing, negotiating, legal paperwork, time sensitive deadlines and a lot of legwork – an experienced professional realtor is an invaluable partner and integral part of selling your investment or recreation property and getting you the most money with the least amount of hassle.

I would be happy to assist you with my decades of experience in this field, or refer you to one of my reliable real estate connections across North America.