Perth’s property market offers excellent opportunities for investors, but when the time comes to sell, the goal is clear—maximise your profits. Achieving the best return requires a combination of strategic timing, smart renovations, effective marketing, and minimising expenses like taxes.
One of the biggest factors that can impact your overall profits is capital gains tax (CGT). Many investors unknowingly pay more CGT than necessary when selling their properties. Fortunately, there are legal strategies to reduce or even avoid CGT, which can significantly increase your net profit. If you’re looking to learn more about how to minimise capital gains tax, this comprehensive guide provides valuable insights.
Now, let’s dive into the key strategies to maximise profits when selling your investment property in Perth.
1. Time the Market Wisely
The Perth property market, like any real estate market, experiences cycles of growth and slowdown. Selling at the right time can significantly impact your profits.
- Monitor market trends – Keep an eye on property price growth, interest rates, and buyer demand.
- Consider seasonal factors – The spring and summer months typically attract more buyers, leading to higher competition and potentially better sale prices.
- Review local development plans – Upcoming infrastructure projects, rezoning, or commercial developments can increase property values.
Engaging a property market expert or real estate agent can help identify the best time to sell based on current market conditions.
2. Make Strategic Renovations
Not all renovations add value, so it’s essential to invest in upgrades that offer the highest return on investment (ROI). Here are some cost-effective improvements:
- Curb Appeal Enhancements – First impressions matter. A fresh coat of paint, landscaping, and a well-maintained entrance can increase buyer interest.
- Kitchen and Bathroom Updates – These are the most scrutinised areas by buyers. Simple upgrades like modern fixtures, new countertops, and fresh tiling can add significant value.
- Energy Efficiency Improvements – Adding solar panels, insulation, or energy-efficient appliances can make your property more attractive to buyers concerned about rising energy costs.
Avoid overcapitalising—spend wisely to ensure your renovation costs don’t outweigh the value they add to the property.
3. Price Your Property Competitively
Overpricing can lead to a property sitting on the market too long, while underpricing can result in lost potential profits.
- Analyse recent sales – Check comparable properties in your suburb to understand the going rates.
- Get a professional valuation – A property valuer or real estate agent can provide an accurate market assessment.
- Use strategic pricing – Setting a slightly lower price than the competition can create a sense of urgency among buyers, potentially leading to a bidding war.
4. Market Your Property Effectively
A strong marketing strategy can attract more buyers and increase competition, driving up the final sale price.
- Invest in high-quality photography and videography – Listings with professional photos sell faster and at higher prices.
- Leverage online platforms – List your property on popular real estate websites such as realestate.com.au and Domain.
- Use social media advertising – Facebook and Instagram ads can reach a larger audience, including interstate and overseas investors.
- Highlight the lifestyle benefits – Instead of just listing features, market the lifestyle your property offers, such as proximity to beaches, cafes, schools, and public transport.
5. Consider Off-Market Sales
Sometimes, selling off-market (without listing publicly) can be beneficial.
- Avoid marketing costs – No need for advertising expenses.
- Maintain privacy – Ideal for sellers who don’t want public exposure.
- Attract serious buyers – Private sales often attract motivated buyers who are ready to move quickly.
Real estate agents often have a database of buyers looking for specific properties, making off-market sales a viable option.
6. Minimise Selling Costs
Maximising profits isn’t just about getting the highest price—it’s also about reducing expenses associated with selling.
Real Estate Agent Fees
- Negotiate commission rates, especially if selling in a strong market.
- Consider performance-based incentives where the agent earns more for exceeding a target sale price.
Conveyancing & Legal Fees
- Compare quotes from different conveyancers and property lawyers to get the best deal.
Marketing Costs
- Some agents offer pay-on-sale marketing, which means you don’t pay upfront.
Staging Costs
- If your property is vacant, staging can increase appeal, but weigh up the costs before committing.
7. Reduce Tax Liabilities
As mentioned earlier, capital gains tax (CGT) can take a big bite out of your profits if not managed correctly. Some ways to reduce CGT include:
- Holding the property for more than 12 months to qualify for the 50% CGT discount.
- Using the main residence exemption if applicable.
- Leveraging the six-year rule if you previously lived in the property.
- Offsetting capital gains with capital losses from other investments.
Final Thoughts
Selling an investment property in Perth can be highly profitable with the right approach. Timing the market, making cost-effective upgrades, pricing competitively, and reducing tax liabilities are all key factors in maximising your return.
By implementing these strategies and working with experienced professionals, you can ensure that you walk away with the highest possible profit from your
