Real Estate Investing: Is It Time to Sell or Hold?

Lately, many investors are asking themselves the same question:“Should I sell my property now, or keep holding it a bit longer?”

It’s not just Baby Boomers thinking this way — even investors who bought during the pandemic at historically low interest rates (below 3%) are reassessing their next steps.

Inventory remains tight, mortgage rates are gradually easing, and buyers are returning to the market. It might seem like a great moment to sell and lock in profits — but what happens after you sell?Is it wiser to move your capital into the stock market, or to keep your real estate assets and enjoy stable cash flow?

💵 Why Some Financial Experts Say “Now May Be a Good Time to Sell”

A viral TikTok video recently featured a financial advisor telling a client to sell two of their rental properties. The reasoning?

“If managing real estate doesn’t bring you joy, and you have no one to pass it on to, shifting your money into the stock market might offer higher returns.”

Some financial planners agree.Andrew Latham of SuperMoney.com notes,

“Over the long run, broad stock indexes like the S&P 500 have outperformed real estate.”

Historically, inflation-adjusted stock market returns average 7–10% per year, while home price appreciation averages 3–4%.

For example, if a $500,000 rental generates $20,000 in annual net income after expenses, that’s only a 4% return. Even after accounting for capital gains taxes, selling in an up market can make financial sense.

Real estate also requires more time and effort — managing tenants, maintenance, taxes, and accounting — while index funds and ETFs are passive, low-cost, and diversified investments that don’t rely on local market conditions.

🏠 Why Many Experts Still Recommend Holding

That said, plenty of professionals still argue that holding real estate offers unique advantages.According to Realtor.com, U.S. home prices rose 4.5% in 2024 and are projected to rise another 2.5% this year. While that’s slower growth, it still reflects a stable asset class.

For retirees or long-term investors, real estate offers predictable, inflation-protected income.Latham adds,

“Real estate serves as an inflation hedge. Rental income functions like a personal pension, providing reliable cash flow over time.”

Selling, however, comes with capital gains taxes — up to 20% federally, plus potential state taxes for high earners.That’s why many investors choose to defer taxes through a 1031 exchange or continue holding properties to maximize rental income and long-term value.

⚖️ The Smart Approach: A Balanced Portfolio

Stocks offer growth and liquidity but come with volatility.Real estate provides stability and income but is less liquid and requires management.The key is balance.

Financial experts recommend diversifying rather than going all in on one side.For instance, if you own two rental properties, you might sell one to increase liquidity and reinvest in stocks or bonds, while holding the other for steady rental cash flow.

Craig Kirsner of Kirsner Wealth Management cautions:

“If you sell real estate and move into stocks, make sure your risk level still matches your comfort zone — don’t jump from the frying pan into the fire.”

💡 Final Thoughts

There’s no single right answer — the decision depends on your goals.Ask yourself: What is the purpose of my investment right now?

If you need liquidity, partial selling may make sense.If you value stable income and tax efficiency, long-term holding might be wiser.

Either way, now is a great time to revisit your strategy and align it with your financial goals.

If you own investment property in the Chicago or Illinois area, let’s review your options together — from timing your sale to building a balanced, resilient portfolio.

Chicago Real Estate – Hansangcheol (한상철)📞 773-717-2227📧 ChicagoBDB@gmail.com