what would you do
Hi guys, I normally hang out at the decorating forum but I'm currently facing a dilemma and need to pick your brain..
We bought our 1st home 5 years ago for 250K. We can sell it for 550K. Current mortgage is about 1500/mo (fixed rate)and annual property tax is about 300/mo (tax will remain relatively constant because in CA your property tax is based on your purchasing price and not assessed value).
DH's relocated d/t job changes. Our choices:
(1) Sell the house and keep the 200+K profit to be used as down payment for the nxt house.
(2) Rent this house and start saving from scratch. The house can be easily rented for 2000/mo. Basically the house will pay for itself. The monthly extra $$ from rent will be put in separate account to pay for maintenance cost. We will have delaying buying our house for 2-4 years while saving for the down payment. Also, we will have to settle for a smaller house.
We have cash saving of a/b 6 months expense & rent. No debt. I project we can save a/b 1500-2000/month after all expenses & rent (we'll be renting for the same amt as our mortgage on the old house). Thus far DH has been the only one working (I'm SAHM) but with DD's reaching the preschool age I can start going back to work in 6 months or so.
Should we rent the place and be tight for a while or should we sell and keep the cash? Our vacancy rate is low about 3.8% and we are in a desirable location (good school, safe, etc, easy freeway entrance).
Thanks for your help.