Should I sell? When to sell an investment property starts with a different question: what is the property doing for you now? I am a buy and hold man. Holding is the plan, and much of what I’ve seen go wrong for investors over the years started with a sale that did not need to happen. I am a realist too. There are times when selling is the right call.
Why hold? Because the rent is only part of what a good property gives you. The bigger egg, as I see it, is the equity it grows. Hold the property and that growth stays with you, and you may be able to borrow against it to buy the next one while the first keeps paying rent. Done with care, more than once, the equity and the cash flow can build together. Borrowing against equity also adds debt and risk, so it is worked through with your lender and your accountant. Sell, and the next owner keeps the growth from that day on.
So the question underneath is the one I would put to anyone: could I be doing better? Think of it as a checkup, where the answer might be to hold and change nothing, to sell, or something in between.
When to sell an investment property, and when to hold
Three situations come up again and again, and though they look alike from the outside, they are not.
- The gun really is at your head. Income has stopped, a loan is due, or life has changed in a way no restructure can carry. Then the honest answer is to sell. That is a decision, not a failure, and the task becomes selling well.
- You think it is, but it is not. I have watched people sell because they believed it was their only way out, when it was not. They did not know there were other ways through a tight patch, such as capitalising interest or expenses for a time until the cash flow comes right again. That is not right for everyone, and it is worked through with your lender and your accountant. A sale made in a hurry cannot be undone.
- It is the wise strategic move. The property has given you its best. It is tired, it costs more each year to keep, there is little depreciation left to claim, and you do not want to spend more on it. Selling one to buy another, or selling two to buy one, can leave you better off, even after tax, stamp duty and the costs of selling and buying. It can, though it may not, and only a model with your own numbers shows which. I am not telling anyone to sell; only that the question deserves an answer.
Selling one property to buy a different kind can be part of that strategic move. If SDA homes are on your mind, I have set out the bad with the good, and the bar I hold them to, in SDA homes and the MRD Benchmark.
The farmer and the tractor
A farmer has a tractor that starts every morning and does the job, and then a better one comes out. Trading up costs money, and the old one is paid for, so most farmers would keep it. But what if the new tractor doubled his output, and the cost of the trade came back in the first year, with double the output every year after? Would that be worth it?
Real estate is never that tidy, and the farmer’s question still holds: what does the change cost, and what does it give back, year after year? If the answer is clear, the trade may be worth making. If it is not, the old tractor keeps working.
If you sell, sell well
Once the decision is made, the next choice is the agent, and this is where the price is won or lost. An agent acts for the seller, and in Queensland, for example, the law requires the agent to negotiate the best possible price for you. Not every agent finds it pays to work that way, and the reason is in the arithmetic.
Say the commission is 2.5 per cent, so a sale at $800,000 pays the agent $20,000. Hold out for $850,000 and the commission becomes $21,250. The extra $50,000 is worth $1,250 to the agent and $48,750 to you, before any tax. A few more weeks of work for $1,250, or a quick sale and on to the next listing: the commission does little to reward holding out for your best price.
There is no official commission rate; it is agreed in writing when you appoint the agent (Queensland Government, Charging commission for selling and letting (updated 20 October 2020)).
Agents tend to work one of two ways. One takes the first fair offer and moves on. The other reads the buyers, negotiates, and holds the line for you. On a property you bought years ago, the gap between the two can be tens of thousands of dollars, and it comes straight out of what the property made for you.
A seller can have any agent put seven things in writing before signing anything:
- A price range, from the least to the most they expect, and what happens to their commission if the sale falls below it.
- The commission, set in writing before you sign.
- Other agents welcome to bring buyers, with the commission shared, so no buyer is missed.
- Ways to end it: at once if they propose a price below the range they first gave you, and for poor work after a short time to put it right, written in from the start and within the term the law allows.
- No commission on a buyer you already know and named in writing before you signed.
- At least five past clients you can ring yourself.
- Your own conditions added in writing, and the right to walk away if the agent will not accept them.
In Queensland, for example, a sole or exclusive appointment to sell can run for 90 days at most, and an agent who gives you a price estimate must back it with at least three similar sales nearby in the last six months or, if there are not three, written advice explaining the figure. Other states set their own limits. South Australia allows 90 days, extendable once to 180; Tasmania 120; New South Wales sets no term. The fair trading or consumer protection office in your state or territory sets out the rules where you live. I have gone further into this in How to choose an agent to sell your property.
What my family learned
For years, when clients I had helped came to sell, I had no lived experience of selling with an agent to teach them from. Then my dad died. My brother was the executor, and we agreed to test the market with one agent, meaning to take the best offer and hold the rest. Each property sold, one after the other, for more than any of us expected, so we sold them all. The agent was honest with us when we did not want to hear it, and a negotiator to the last day. Clients since have told me the same about agents who work that way. It changed how I teach selling.
The checkup
So, should you sell? The checkup question comes first: could I be doing better? The answer might be to hold, to restructure, or to sell and sell well. Each has a cost and each has a payoff, and they are far easier to see side by side, before anything is listed.
If you are weighing a sale, it helps to talk it through before ringing an agent. To do that, book a first conversation. It costs nothing.
Nicholas Lockhart
This article reflects the law as at 14 October 2026.
Sources: Queensland Government, Appointing a real estate sales agent (updated 19 July 2024); Queensland Government, Charging commission for selling and letting (updated 20 October 2020); NSW Government, Agency agreements for the sale of property in NSW (updated 8 July 2026); SA Government, Hiring a professional for house and land sales (updated 9 June 2026); Property Agents and Land Transactions Act 2016 (Tas), section 44.