Sudden move, rent my place or sell?

UpNorthHeyJuly 10, 2012

I just got a great job and have secured a place to rent in our new home town. So the question is what to do with my current home? The local realtor (friend) told me if I could hold on to it and sell in a year, I would recoup and improvements I made to sell it. During that time I could rent it (I have a family willing to rent it at a price the covers my mortgage, taxes and insurance).

But today I got a call from a young family wondering if I was looking to sell it. So it wouldn't be "turn-key" condition, more "as-is".

Should I sell now and just move on?

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melody-s

I think you need to answer a few questions for yourself in order to make that decision.

Can you afford the mortgage if you lost the renters? Do you really want to be a landlord for a year (or longer)? What is the potential financial gain from waiting a year? Is it worth the risk?

    Bookmark   July 10, 2012 at 11:51PM
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mic111

I think so. You don't know what the market will be doing in a year. There is no guarantee it will go up. It could be down drastically. Of course it could be up also but a family can do alot of damage in a year. Lots of variables at play. I would go with the sure thing, sell it.

    Bookmark   July 10, 2012 at 11:53PM
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weedyacres

Nobody can guarantee that a year from now prices will be X (and I'd avoid a realtor who claimed to know they would). It sounds like there's interest in your house for both renting and selling, without your doing a lot of work. That makes me think it wouldn't be too hard to sell. I'd go with that option.

    Bookmark   July 11, 2012 at 7:00AM
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ncrealestateguy

Sell it... You know what the value today is. Next year you do not and niether does your agent friend. The way cities in California are declaring bancruptcy over the last week (3 of them), there is no sure outlkook.

    Bookmark   July 11, 2012 at 7:03AM
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vapourous

I'd sell. I'm an unintentional landlord and while I have great tenants, it's really not a pleasant thing to do. Some of the nicest people turn out to be the worst tenants.

If you can sell to the interested couple without realtor commissions (just use real estate lawyers), you'll save quite a bit of money.

    Bookmark   July 11, 2012 at 9:39AM
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terriks

The local realtor (friend) told me if I could hold on to it and sell in a year, I would recoup and improvements I made to sell it

I wouldn't trust an agent who made any kind of predictions.

I'd sell it now and move on.

    Bookmark   July 11, 2012 at 12:18PM
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adellabedella_usa

Sell it. Even good tenants don't keep a place up like an owner would. In a year's worth of time, the carpet could get a lot of wear and tear, the walls could need repainting, and the landscaping could need to be fixed. It would be wear and tear and additional hassle for you on down the road. I'd sell now and move on.

    Bookmark   July 11, 2012 at 12:56PM
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krissie55

It is a toss up as to what you need to do. However, I recently sold a house at a great loss. My son's friend in real estate told me to be glad I was able to sell now because the real estate market has not hit rock bottom yet.

The cost of repairing the house/yard after having renters would be steep. Renters do not take care of things and many will move out without notice or will not stay current on rent, etc.

My vote is to sell now and not take a risk on the future.

    Bookmark   July 11, 2012 at 2:26PM
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terriks

My son's friend in real estate told me to be glad I was able to sell now because the real estate market has not hit rock bottom yet.

Hmm, another Realtor with a Crystal Ball?

    Bookmark   July 11, 2012 at 2:51PM
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azzalea

My Dsis and BIL have a rental unit. EVERY time a renter moves out, they have to put thousands of $$$ into the property to repair it for the next tennant--Once they had to replace all the appliances, sometimes it's plumbing, or replacing floors, etc.

I cannot see any advantage of hanging onto something you can sell at a fair price now. There are SO many variables that could come into play in a year. Me? I'd take the money and run, where I'm sitting, it's a no-brainer.

ONLY way I'd hang onto it and maybe rent? Would be if I knew my move was temporary and I'd be returning to the area in a year or so. That, of course, would put a whole different spin on your question.

    Bookmark   July 11, 2012 at 3:23PM
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brickeyee

"I have a family willing to rent it at a price the covers my mortgage, taxes and insurance"

Those are NOT your only expenses.

Maintenance and repair YOU might peffrom now have to be paid for.

Clogged drain?

Call the landlord.

Garbage disposal jammed up?

Call the landlord.

Unless you can rent for MORE than your simple carrying costs (PITI) you will lose money.

When you then sell you will be taxed 'depreciation recapture' (and you MUST take depreciation).

Unless you WANT to be a landlord (and it is hard enough on a local place, let alone by 'remote control') sell the place.

    Bookmark   July 11, 2012 at 3:45PM
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UpNorthHey

Thank you all for your great insights. The comment that really hit home was about trying to show it next spring with the renters in it, esp if they cannot afford it themselves and are facing another move...

Also, being landlord 300 miles from the house started to sound like a potential hassle.

Thanks everyone for your thoughts!

    Bookmark   July 11, 2012 at 11:12PM
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brickeyee

I have local properties and spend many a Saturday doing maintenance.

    Bookmark   July 12, 2012 at 11:29AM
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kswl2

Sell it! In a year your improvements will be another year older.....

    Bookmark   July 15, 2012 at 11:29PM
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