I recently went through a stressful week because I was selling my studio flat in the suburbs of Paris. I had a buyer lined up back in June, but it took forever for the lawyer to draft the contract, and we only got around to signing the sale at the beginning of August. You’d think that by then, we’d have sorted out all the necessary details, but that wasn’t the case at all.
The buyer’s lawyer kept asking me for various paperwork, which is pretty normal, but after two months of slow progress, I was already frustrated. When he started requesting information he already had, I lost my patience. It felt like he expected me to do his job, even though I was traveling and had limited internet access and barely any access to the necessary documents.
I responded curtly, pointing out that while his client had every right to ask questions, it was his responsibility to find the answers. Even though I provided the buyer with the information to avoid jeopardizing the sale, the lawyer’s indecisiveness made the buyer nervous, and I lost the deal. In Paris, after signing, there’s a seven-day period during which either party can back out.
So, there I was, stuck paying three more months of condo fees and taxes, with an empty flat, all while I was still traveling on my motorcycle. I planned to return to Paris in ten days, so I listed the flat again a few days before returning, deciding on a firm price. Last time, I listed it for $60K and sold it for $56K, but this time, to avoid wasting time negotiating, I set a non-negotiable price of $58K. Luckily, six people showed interest for the upcoming weekend, and the first person who visited accepted the price. She even had me sign a paper right then to confirm the sale and agreed price.
We were supposed to officially sign the agreement with our lawyers that same week, using the same lawyer to speed things up. Unfortunately, the lawyer misinformed the buyer that she might owe $5,000 in condo fees from previous years, which scared her. I was worried too since I had no prior knowledge of such fees, so I spent an entire evening reviewing the condo’s financial records and found nothing. I convinced her to meet at the lawyer’s office, where after three hours of discussion, the lawyer admitted to the mistake. However, due to the delay in paperwork, we lost another ten days, costing me $150.
I was also anxious that during the delay, she might find a better deal or come up with an excuse not to sign. Eventually, after what felt like forever, we signed the agreement last week. She had an eight-day cooling-off period but didn’t back out. The only potential issue now is her not getting the loan, but as a government employee, I’m not too worried.
I needed this sale to go through not only for the much-needed funds to purchase land in Guatemala but also because my flat had been empty since March, and I didn’t want to continue bleeding money in fees and taxes. Selling the flat within six months is actually pretty quick, considering I had it listed with agents for months, and they were mostly unhelpful, even suggesting I lower my price by 30%.
Now, I can finally move on and focus on my new land in Guatemala. My offer for the land has been accepted, so I’m officially a landowner!
Let’s break down the finances:
### Expenses:
– **Purchase price with legal fees:** $25,000
– **Maintenance fee (since the flat is empty):** $600 ($150 per month for four months)
– **Rent for a security door:** $800 ($200 per month for four months)
– **Taxes:** $3,600 ($400 per year for nine years)
– **Two months of fees if the sale goes through:** $700
– **Total Expenses:** $30,700
### Income:
– **Rent for nine years:** After deductions, the net rent was about $800 every three months, totaling $28,800.
– **Selling price:** $56,000 (the flat doubled in price five years ago)
– **Total Income:** $84,800
### Net Profit:
– **Total Profit:** $54,100 (an estimated annual return of 17%, non-compounded)
After considering all factors, I made about a 5.5% compounded return over nine years, which is a solid return. I’m grateful for buying the flat right out of college, even though I initially wanted to borrow more to buy something bigger. The bank didn’t let me borrow, so I settled for this flat.
Keeping the money in a bank account back then would have been complicated, especially since I was abroad. The return on the flat turned out to be much more favorable. Despite the recent frustrating months dealing with the managing agency and the sale, I’m relieved to have closed the deal. Hopefully, in two months, I’ll have a sizable check, ready to invest in building my new home on my land in Guatemala.