To sell or not > greater than 10 year cashflow plus principal pay

[Terry Lao]

I have developed an two part equation to help decide to sell or not. Please comment.

1. Is net sales price greater than 10 years net cashflow and principal equity payments? For example, net cashflow of $500 per month and $500 equity increase from mortgage payments, which equals $12k per year. Times 10x equals $120k. The net sales proceeds needs to be greater than $120k or answer is NO.

2. Which stage of real estate cycle is market on? ( if peak or near peak, then yes, otherwise no)

Both answers need to be yes, before sell.

What do you think?

Terry

[Terry Lao]

Below is chart of real estate cycle.