Should You Sell? How to Make an Informed Decision

When deciding whether to sell, it's crucial to consider whether you're in a seller's market (few homes for sale and rising prices) or a buyer's market (many homes for sale and falling prices). A buyer's market could significantly affect the price you achieve and how long your property takes to sell.

It's also worth investigating which types of homes are selling best in your area right now — your agent, and recent sales data for comparable properties, will tell you a lot.

Selling a property and relocating can cost tens of thousands of dollars once you add up real estate commission, marketing, legal fees, moving costs, and the costs of buying your next home.

The less equity you have in the property, the greater the impact of these costs. If your mortgage is close to the property's value, the sale proceeds may barely cover your costs. Calculate the numbers carefully before you commit.

View our property law fee chart →

The timing of your sale matters. If you're selling in a buyer's market and your equity is low, you may struggle to cover your costs and repay your lender from the sale proceeds. The greater the equity you have in your home, the better equipped you are to absorb the costs of selling and still come out ahead.

If you can wait for better market conditions, it may be worth doing so — particularly if your equity position is tight.

New Zealand's bright-line test means that if you sell a property within a certain period of purchasing it, any profit may be subject to income tax. The bright-line period has changed several times in recent years, so it's important to check the current rules and understand where you stand before you sell. GST can also arise on some properties.

If you're unsure, get advice from your accountant or tax adviser before listing. We can refer you to a suitable adviser if you don't have one.

Read more about bright-line, GST and mortgage break fees in our selling guide →

Before you decide, it pays to know what a buyer's lawyer will find when they search your title and the council's records. A title defect, an unconsented deck or a missing Code Compliance Certificate discovered during a buyer's due diligence can cost you the sale, the price, or both.

Every problem is cheaper to fix before you list. We can check your title and flag anything that needs attention while you still control the timetable — and before it affects your decision on whether, and when, to sell.

See what to check and fix before you list →

Before you sell, consider whether there's a better solution to the problem you're trying to solve:

• Need more space? Renovating or extending your current home may be cheaper than selling and buying a larger property — especially once you factor in transaction costs.
• Difficult neighbours? A tall fence or a conversation with your local council may resolve the issue without the cost and disruption of moving.
• Concerned about safety? Check the crime statistics — your current neighbourhood may be safer than you think, and a new area may not be any better.
• Need to free up cash? Consider refinancing, a reverse mortgage (if you're retired), or renting out part of your property before selling.

Sometimes the best decision is not to sell at all.