When to Cut our losses - how to calculate

[MissRachelFinallyLostHerMind]

DP got a 1 bed flat with Help to Buy just before we met.
Fast forward a few years, we had a baby so had to move out as no space, the Help to Buy mortgage matured, we got a permission to let for 2 years as the market was such it would have been difficult to sell.

we currently rent and make a bit of money from the 1 bed (after mortgage/ground rent/service charge are paid), plus are building equity as time goes by. We have 1.5 year left on the permission to let and it’s doubtful the bank and help to buy will allow us to extend it further.

the market is still not great, there are a few similar flats in the same development on the market at the moment for less than what DP bought his for. I really want to buy somewhere and, although we’ve saved, would need some money in the form of the equity from the flat for a deposit.

does anyone know how we could calculate at what amount we could sell the flat without losing money?

for example (numbers not real):
let’s say we get 30K in equity out of the flat if we hold for a year
but in the meantime, we’ve spent 20k in rent
if we sell it now, we would get 10k out.

therefore it’s 10K either way.

I know there are several other factors to consider in that calculation - the ‘profit’ we’re currently making, when we would be able to leave our rented flat ( 6 months is the earliest and we wouldn’t be able to sell flat + complete on a house in that timeframe anyway), etc etc

Just sell it and get on with your life.

I live near a lot of flats and you see this face-saving shit where people are desperate to sell it for more than they bought it for and not a pound under, and hence sit on the market for ages.

As you can see there are many things that go into the calculation of what is a profit and loss, for example money wasted on renting, but you cannot value time and you can't get that back.

If you look at sold flat prices especially for new flats then the majority seem to be losing money. Flats can be a
poor investment.

If you don't think you'll get permission to rent extended then sell sooner rather than later. If you don't you could end up with a flat which costs you energy, council tax and service charges every month with no income so any small gain now is potentially quickly wiped out. It's never going to be an exact science and even if you market now you might not sell and complete in that time.

Leasehold flats are worthless.

Don’t forget to factor in capital gains tax, because it’s been rented out for a spell, I believe it may attract it? I may well be completely wrong!

I can’t think of how to calculate what you’re asking about though. I wouldn’t deduct your rent out of it, because that’s a cost you’d be paying anyway as your living costs and this presumably comes from your monthly earnings, plus the property in question is effectively a btl for now. I’d work it out as:

Flat value - mortgage amount, htb loan/fees, estate agency fees, cgt if applicable = potential equity for new property.

I’d allow a year to sell it though as I’m cautious and wouldn’t want to get stuck with paying all the costs associated with it with no rental income and my own rent to pay to someone else.