As some of you know I split up with my GF last summer and we have this apartment in AG (2011, 124m2) that we bought 3 years ago. We moved out and it is empty since November 2024. We first tried to sell it for 969k and didn‘t get any offer for 3 months (I started promoting it in September). Then we reduced the price down to 899k beginning of January and started having people contacting us. But still no real offers and only 3 visits so far. One of those would be interested in buying it for 860k.
1.5 weeks ago I put it up for renting (2.6k/month including NK and 1 garage) and we already had over 10 people visiting, another 5 will come today/tomorrow. 2 of those want to rent it out starting Mid April. So we could rent it out very quickly. But I‘m not sure about the right decision here. If we sell for 860k, both of us would get 90k after taxes (we paid 60k each 3 years ago). If we rent it out, both of us would get around 0.6k/month net after taxes for renting it out. Assuming we stay in Saron and interest rates stay stable for a couple of years.
What would you do? Rent it out for a couple of years and try selling it again (maybe this time with a RE agency) in 2-3 years? Sell it for 860k and invest those 90k into the market? Or rent it out and never selling?
I think the key question is how did you come to 969K value. Could it be that you created a higher threshold in your mind and now you feel lower price is not a good price ?
Compared to 860K and 2.6k per month rent, the yield is about 3.5%. How does it compare to average rental yield in your area?
If the GF does the work related to renting, I would rent. If I had to care, I would sell. Which brings up a third option: you sell your share to your GF and she does whatever she wants and vice versa
I saw other apartments (lower buildquality) in the 800-900k range and my own estimate (using my bank tools) was at 900k. So I tested the market if anyone would pay more than that. As nobody showed up I reduced it to the „fair value“.
@ChickenFat
We both moved away from the apartment, like 30-40min with a car away. She still has ties there because of her family, but yeah. We aren‘t that close anymore. But I don‘t think it‘s a hassle. We lived 2 years there and had no issues or any need for replacing anything. So I don‘t expect any work.
That‘s why I‘m undecided. We aren‘t in a rush but I‘m also not sure how prices will develop in the coming years. If we sell in 6 years, the apartment will be 20 years old. Will we get less, more, the same? I don‘t know.
How bad is it to sell an apartment with a tenant inside ? How much does it affect the selling price ? What are your options when you want to sell but the tenant does not intend to move out ?
So either 90k, or 7.2k / year? That’s 8% return on own capital, for an asset that’s somewhat uncorrelated with your other investments. Seems like a pretty good deal.
However…
… at least I don’t want to be doing that kind of work as a side business, which is why I sold my apartment in my home country a year after moving to Switzerland. The worst part is that the amount of work is highly variable and the timing is unpredictable.
It’s harder for sure as the apartment isn’t empty and the current tenant needs to be around so that people can visit the apartment. But we will probably chose a doctors couple working in a hospital if we rent it out. They earn 300k/year, so I see no issue in kicking them out. Or maybe even offer them to buy it after they lived there for some time. But it would be more complicated selling it for sure.
15 to 20 years is a timeframe where a couple of repairs need to be done. In my case, the supplier of the devices needs two emails to fix or replace things but it’s still money going off your 600\month
Any tenant with a bit of brain left will immediately after you mention your intention to sell
start counting his money
look for other places
Also if you sell with a tenant:
If the buyer wants to rent: everything is fine (as long as a renting contract exists)
If the buyer wants to move in: he can usually kick the tenant out within a couple of months.
So while this should not affect the price too much.
3.5%. Not worth it at all. This isn’t even factoring other costs and repairs.
Boy are you going to be in for a rude awakening!
My advice: if you have a buyer already at 860k. Sell it and be done with it!
Another way to look at it is this: if you have 90k now and no flat, would you go out and buy it as a real estate investment and decide to go into the landlording business in partnership with your ex-gf to earn 600 Fr per month before unexpected costs? That sounds crazy, right?
I personally would sell right now at 860K.
As you’ve said, there’s always uncertainties coming ahead. Prices in your region might fall and your appartment getting older won’t help and finally the relation you’ll get with your tenants that might turn from being super chill and smooth to nightmarish.
But number 1 point that would make it sell for me is because it is still tied to your ex-GF. You’re in profit now, so take the money while cutting the last legal rope you got with her and start your new chapter with a blank page and a piece of mind.
Is it really that simple ? I think the tenant can appeal the contract termination. The tenants has rights and can only be kicked out under specific conditions. Regardless of who wins between the tenant and landlord, you’re stuck with a judicial process that can take more than a year.
This is probably very canton dependent. In Romandie tenant protection is probably higher.
If you rent, you will have your ex as your business partner. If the relationship ended in good terms and you are willing to split the rent, costs and manage the property, that’s great. If not, sell it.
Absolutely this! Cut ties while relationship is still cordial. If profit drops to zero or you end up in a loss-making position on it, then things can get quickly more difficult.
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