Student Question
Hello, Master. I remember when I first bought my home — I felt not only that I finally had a place of my own, but that I was absolutely certain the value would go up.
That was in 2020.
Then came the nationwide risk controls, and I felt like I’d been thrown off track.
Two years later, I relocated to a different city for personal reasons and started preparing to sell the property.
I added up everything — down payment, mortgage, taxes, and agent fees — to calculate my total cost. Then, based on market prices at the time, I figured I’d still come out slightly ahead.
That was June 2022.
I listed the property for six months, but the agent was passive and barely ever reached out. Eventually I took the initiative and contacted them myself.
They set a very low asking price, and the property sold within a few days.
After the sale, I immediately felt like I’d sold too cheap. Current listed prices in the area are all higher than what I got.
At the time, the agent kept pushing me to lower the price — and yes, after lowering it, showings became more frequent. But compared to my total cost, I ended up losing about 50,000 yuan.
Interest rates were also on the higher side when I originally bought.
I’ve been thinking about this constantly these past few days. Will housing prices rise next year? If they do, I’ll feel unsettled — even anxious. But if I hadn’t sold, I wouldn’t be living there either. That’s just waste. Now that it’s sold, I have more capital to work with and can plan ahead more effectively.
Master, I just want to ask: was selling the house the right decision?
Master Chi’s Response
You didn’t mention which city, so I’ll speak generally.
Which types of properties don’t need to be sold quickly?
- Properties you bought early — cost basis is low, no rush.
- Properties where rent roughly covers your mortgage — no need to sell.
- Properties where you have a genuine need to live — no need to sell.
- Properties held as part of a diversified asset allocation — no need to sell.
- Properties in core districts of major cities — no need to sell.
Beyond these categories where the property is genuinely working for you — everything else should be sold as soon as possible.
Why do I say this?
1. Future appreciation is limited. 2. Holding costs keep rising.
Keep the good ones. Sell the mediocre ones fast.
Since you bought in 2020, go back and look at how much prices rose — and fell — between 2019 and 2022. How does your mortgage payment compare to rental income? Does the property have the four key factors: prime location, school district access, quality construction, and alignment with the city’s development direction?
Also check how long properties in your complex typically take to sell, and what the overall price trend in your city looks like.
To give you an example: Shenzhen saw three major price surges between 2014 and 2022 — a big run-up in 2015, another in 2017, and another in 2020. Some people caught all three waves, some caught two, some caught one, and some caught none at all.
If you caught at least two of those waves and your property is reasonably solid — not terrible — there’s no need to sell. This is Shenzhen. But if you only caught one wave, or none, you need to seriously evaluate. Odds are you should sell.
Say you caught one wave — bought at 7 million, watched it climb to 9 million, and now it’s slipped back to 7.5 million. In 2023, prices will almost certainly continue falling. Breaking back below 7 million is only a matter of time. In that situation, you must sell.
Caught none? Don’t even hesitate. Just sell.
It’s like standing tall on the summit of Everest — the mountain is high, the wind is brutal, and it’s bitterly cold. The smart move is to come down. Unless you’re living in the property, if it needs to go, sell it.
Ask yourself: when did you buy? Why did you buy? Is there a real reason to hold on?
Take Shanghai as an example:
- Bought before 2016? You can hold — you’ve earned well and your cost basis is low.
- Bought around 2019? Prices also rose. If the property scores 70 or above in quality, you can hold. Below 70, consider selling.
- Bought after the 2021 surge? Appreciation has been modest, and most critically, costs are very high — ongoing mortgage payments and interest, all at elevated rates. Looking profitable on paper today doesn’t guarantee it will be profitable in the future.
There’s one more thing worth thinking about. Every yuan you make comes from someone else losing it — and the reverse is equally true. When a property appreciates and you want to exit, you need a buyer willing to pay more, to absorb a higher cost. When a property falls and doesn’t sell easily, the buyer gets in cheaper — but they may also face further declines and end up losing too.
Think through all of these scenarios. Even profitable positions can turn into losses. So don’t tie yourself in knots over this.