People who moved last minute...

[mizzou]

I'm about to venture on a journey to a new city, about 2 hours away. My only debt is my home....and I calculated that I could live in a new apartment and make just enough money to keep paying the mortgage on my old home.

Worst case scenario...I have enough saved up to get by for a while if things don't work out.

It's possible I could be out of here in 6 months...that doesn't leave much time to get my house "market ready"

The tile in my bathroom is falling apart...my heater is noisy...my driveway is cracked....and paint is faded in many areas.

BUT...I have a brand new deck...brand new patio...remodeled porch...and a new roof

Facing a few options here:

1. Sell house at a discount just to get rid of the headache and drama
2. Use all your free-time and spend a bit more $$ to get the biggest return possible from home sale
3. Try to find a medium...get house move in ready slowly while still paying mortgage pmt.

I'm not sure if renting my house out is an option...but if it is I will only do it to close friends/acquaintances.

Bottom line...a big of elbow grease could let me walk away with several thousand dollars...vs. breaking even (after paying realtor fees on the sale)

Anyway, just curious how some of you have dealt with these scenarios.

 

[ShadowVVL]

I have rented out and sold houses many times.Renting the house can become a mess real fast, you are better off doing a bit of DIY repairs and selling. You should try to get more then or near what you paid for it after DIY repairs.

 

[OCGuy]

I have rented out and sold houses many times.Renting the house can become a mess real fast, you are better off doing a bit of DIY repairs and selling. You should try to get more then or near what you paid for it after DIY repairs.

Sorry, that would be the last blanket statement that anyone who has ever invested in real estate would make.

Maybe in his case selling it is the best option, but you don't have nearly enough information to say that.

 

[Red Squirrel]

What is making you move? You have a house, why do you want to go live in an apartment? Seems counter intuitive.

 

[Wonderful Pork]

You have 6 months, I would DIY the low-hanging fruit which makes a noticeable appearance change (paint, tile repair) and then sell the sucker.

6 months is a pretty decent amount of time to spruce up a home - especially just with new interior paint, which helps a lot.

 

[vi edit]

What is making you move? You have a house, why do you want to go live in an apartment? Seems counter intuitive.

Agility, lower cost, and less work. If you don't know how long you'll be in an area, or where you really want to live in that area, and/or don't want to deal with things like yardwork, upkeep, and snow removal renting is a perfect choice.

Also, if you currently own a home and need to move fast, trying to juggle the sale of your current one and assume financing on the next one is tricky. Offers based on contingency don't carry as much value as straight up purchase offers.

Renting doesn't count against your income like a mortgage does and it's much easier to rent a place out while still carrying the burden of your previous home until it sells.

 

[vi edit]

As for the specifics of your place, many of those things while not "DIY" options can refreshed fairly inexpensively if you put in some of your own work to prep things.

The tile for example, you can get an oscilating tool and a tile spud and remove the tile yourself and get the floor prepped. If it's a small bathroom you are looking at less than 100/sq ft of flooring. Spend a little extra, drop that electric grid under it to heat it (nice selling perk) and then have a tile guy from craigslist come in set the tile for a couple hundred bucks. Hole thing can probably be done for under $1000.

If your drive is concrete, you can rent out a concrete saw and a jackhammer and cut out and remove the busted up pieces. If the size is fairly small you are looking at maybe a yard or two @ $100 a yard for concrete. You can check around for some finishers that will come in and form it up and finish for another couple hundred in cash. Again, depending on size you are looking at $1000-$1500.

Some touch up paint, maybe some new fixtures, some cheap crown moulding with the cheater blocks in the corners in a dining and bedroom and for $3000 out of pocket you can spruce the place up pretty well.

 

[Thump553]

Sorry, that would be the last blanket statement that anyone who has ever invested in real estate would make.

Maybe in his case selling it is the best option, but you don't have nearly enough information to say that.

I disagree with your conclusion. He's going to live long distance from his home. As someone who did that and rented out, as well as a real estate lawyer all I can say is we get a lot of business from long-distance landlords and I rarely see it working out well for the owner.

My view-90%+ chance its best to do the easy and cheap DIY repairs and sell asap. Talk to a real estate salesperson you trust about timing and what repairs you should or should not bother with.

BTW we are coming up on springtime which is traditionally the best time to list by far. People with kids like to contract in the spring and move in the summer before school starts again.

 

[z1ggy]

There's really a lot to consider here, I don't think it's black and white.

I am actually in a similar situation as you, so I can share with you my mindset, but the conditions of the market we are in may be totally different.

I own a 2 bed, 1 bath house that is in VERY GOOD shape. Your's sounds like it needs work. Mine needs little to no work to get it market ready. It basically just needs a solid cleaning of the carpets, maybe some touch up paint, filling in holes I've drilled for screws, etc. So mine would be easier to put on the market.

Secondly, I live in a pretty nice neighborhood. It attracts mainly middle class to upper middle class families. It is also in what would I would call "rural-suburban" living. It's a small town of 16k, has one school and one stop light. It's about 20 minutes to the nearest mall, but maybe only 10-15 from a grocery store.

Additionally, homes are NOT selling very well around me. My neighbors house is for sale and has been sitting there on the market for at least 5 months. No real buyers wanting small homes it seems. The house next door to me was on the market for over a year before it was sold. The house on the other side of me was on the market for at least 6 months before it was sold. Not a sellers market around here.

All this has lead me to the conclusion that renting my house is actually the best option. People might not actually have cash on hand to afford a down payment, and maybe don't qualify for FHA type loans, or just don't know about them. There is a naval base close by, and a large amount of young families coming and going. It is my plan to rent my house and use that income to essentially pay for the rent for my next home in a new location. Because the house is in good shape as I said, I anticipate repair bills to be low. Even if I had to spend $1,000 a year fixing stuff (owned home for 3 years now and spent maybe $500 bucks fixing things), the money I will be saving will more than cover that. Plus, I still get to write the property off on taxes, and I'm earning equity on top of that.

I think you need to really examine your situation carefully before you decide to sell. Owning real estate is generally a very good long term investment.

 

[Meghan54]

There's really a lot to consider here, I don't think it's black and white.

I am actually in a similar situation as you, so I can share with you my mindset, but the conditions of the market we are in may be totally different.

I own a 2 bed, 1 bath house that is in VERY GOOD shape. Your's sounds like it needs work. Mine needs little to no work to get it market ready. It basically just needs a solid cleaning of the carpets, maybe some touch up paint, filling in holes I've drilled for screws, etc. So mine would be easier to put on the market.

Secondly, I live in a pretty nice neighborhood. It attracts mainly middle class to upper middle class families. It is also in what would I would call "rural-suburban" living. It's a small town of 16k, has one school and one stop light. It's about 20 minutes to the nearest mall, but maybe only 10-15 from a grocery store.

Additionally, homes are NOT selling very well around me. My neighbors house is for sale and has been sitting there on the market for at least 5 months. No real buyers wanting small homes it seems. The house next door to me was on the market for over a year before it was sold. The house on the other side of me was on the market for at least 6 months before it was sold. Not a sellers market around here.

All this has lead me to the conclusion that renting my house is actually the best option. People might not actually have cash on hand to afford a down payment, and maybe don't qualify for FHA type loans, or just don't know about them. There is a naval base close by, and a large amount of young families coming and going. It is my plan to rent my house and use that income to essentially pay for the rent for my next home in a new location. Because the house is in good shape as I said, I anticipate repair bills to be low. Even if I had to spend $1,000 a year fixing stuff (owned home for 3 years now and spent maybe $500 bucks fixing things), the money I will be saving will more than cover that. Plus, I still get to write the property off on taxes, and I'm earning equity on top of that.

I think you need to really examine your situation carefully before you decide to sell. Owning real estate is generally a very good long term investment.

While true owning real estate is great, being an out of town owner/landlord can create its own set of unique problems.

First, remember your insurance costs will go up...you're not living in the house but it's now a commercial unit, a rental unit. Ins. rates tend to be a little higher for rental units vs. owner lived in units. Something to do with the amount of care a renter gives vs. an owner.

Second, you're going to have to have an immediate cash reserve/access to whatever amount of money it'll cost to have major repairs done. Just because you've only spent $500 a year so far is NO indication of future repair costs.

Then, who's going to get the water heater replaced the day after it begins leaking? How and who do you hire to fix the A/C or furnace when it quits on a Sunday afternoon and it's blistering hot/bone chilling cold outside?

And then you may end up with a renter that ignores problems until they become impossible to ignore, like water leaks, leaking roof, etc. And that's probably worse than the renter that calls incessantly about every little niggling problem....the creak in the floor, the window that just doesn't open/close quite right, etc., etc.

Out of town landlords, esp. if you're over an hour or so away, many times end up hiring a real estate agent to manage the property, at a cost, of course.

And then remember the taxes. Becoming a landlord isn't for the faint of heart or those living hand-to-mouth. Sure, the rental income can be great, but when the renter leaves and you have to replace every inch of carpeting, repair/repaint all the walls inside the house, etc., etc., it can become a tedious job at best.

Remember, the tenants don't have squat invested in your property, they're renting. And not every tenant will treat your property like you would. That can be seen by numerous posts/threads here.

 

[Greenman]

The heater repair and replacement tile are going to have to be done regardless of of what you do with the house, so the question is, do you repair the driveway or not?

 

[z1ggy]

While true owning real estate is great, being an out of town owner/landlord can create its own set of unique problems.

First, remember your insurance costs will go up...you're not living in the house but it's now a commercial unit, a rental unit. Ins. rates tend to be a little higher for rental units vs. owner lived in units. Something to do with the amount of care a renter gives vs. an owner.

Second, you're going to have to have an immediate cash reserve/access to whatever amount of money it'll cost to have major repairs done. Just because you've only spent $500 a year so far is NO indication of future repair costs.

Then, who's going to get the water heater replaced the day after it begins leaking? How and who do you hire to fix the A/C or furnace when it quits on a Sunday afternoon and it's blistering hot/bone chilling cold outside?

And then you may end up with a renter that ignores problems until they become impossible to ignore, like water leaks, leaking roof, etc. And that's probably worse than the renter that calls incessantly about every little niggling problem....the creak in the floor, the window that just doesn't open/close quite right, etc., etc.

Out of town landlords, esp. if you're over an hour or so away, many times end up hiring a real estate agent to manage the property, at a cost, of course.

And then remember the taxes. Becoming a landlord isn't for the faint of heart or those living hand-to-mouth. Sure, the rental income can be great, but when the renter leaves and you have to replace every inch of carpeting, repair/repaint all the walls inside the house, etc., etc., it can become a tedious job at best.

Remember, the tenants don't have squat invested in your property, they're renting. And not every tenant will treat your property like you would. That can be seen by numerous posts/threads here.

That's why you get references and do a background and credit check. I'm not going to let any person off the street rent my house. I ideally would want a professional, or a nice family moving in. You also collect security deposit for when they do happen to treat your home like crap. You can come with almost any reason as long as you provide a written statement to the tenant as to why you are not returning part of or all of the money to them. My last land lord said he "smelt cat piss" when he walked into the apartment, and took $750 out of my deposit to replace all the carpet and get it cleaned. My cats never pissed on anything ever. All he had to do was provide that written and signed, along with quotes from some cleaning & carpet places.

It's def. not an easy decision, but I can't sell my house. I'm currently underwater and I'd probably lose money if I sold it next year. I currently owe about $155k on the house, and it's worth about $135-145k. After you account for fees and taxes, I'd be about $20k in the hole.

Roof is new, siding is newer, windows are <10years old. Boiler is in decent shape as of 3 years ago when I got the house inspected. Of course you are right- the past is not indicitive of the future as far as reliability goes, but my % odds of things going wrong are lower I think.

Essentially, my only choice if I want to leave this area is to rent the house.

 

[vi edit]

It's def. not an easy decision, but I can't sell my house. I'm currently underwater and I'd probably lose money if I sold it next year. I currently owe about $155k on the house, and it's worth about $135-145k. After you account for fees and taxes, I'd be about $20k in the hole.

I made a stupid decision to buy a house when I wasn't certain I'd be staying in that area for long. Ended up only being there for a year and between a real estate crash and realtor fees I was looking at almost $14k to get out of that hole. I ended needing to take out an unsecured loan to clear up the balance and get out from that place.

Wasn't ideal, but it was better than trying to carry two mortgages or a mortgage + rent. All the more reason to consider for a year or two if you aren't certain what your longevity in that area is.

 

[Capt Caveman]

What is making you move? You have a house, why do you want to go live in an apartment? Seems counter intuitive.

/facepalm

 

[z1ggy]

I made a stupid decision to buy a house when I wasn't certain I'd be staying in that area for long. Ended up only being there for a year and between a real estate crash and realtor fees I was looking at almost $14k to get out of that hole. I ended needing to take out an unsecured loan to clear up the balance and get out from that place.

Wasn't ideal, but it was better than trying to carry two mortgages or a mortgage + rent. All the more reason to consider for a year or two if you aren't certain what your longevity in that area is.

I've been in this house for 3 years. When I bought it, I was with my ex g/f at that time. Turns out she assaulted me a few times, I dumped her and filed some restraining orders, etc etc. Needless to say, that was not planned for. Had I known the future I would have stayed in my condo I was renting. But here I am, I have to play with the cards I've got in my hand.

Selling the house also meant if I came back to this area for whatever reason, I'd have to apartment hunt again. Apartments here are expensive as balls, and they also all suck.

Anyway, Im hi-jacking OPs thread. If I really need advice in the future, I'll create my own thread.

 

[mizzou]

What is making you move? You have a house, why do you want to go live in an apartment? Seems counter intuitive.

won't be set for a while, for instance, I might have a job but my wife my still be looking for one.

Also, there's no guarantee our house will sell fast, I'd rather just have one loose end removed before getting tied up into another one.

 

[Blackjack200]

Then, who's going to get the water heater replaced the day after it begins leaking?

Heh, reminds me of going to look at an investment property about six months ago (FSBO). We go down to the basement and the water heater is sitting in a little lake. It had probably been leaking for months.

His eyes got as big as dinner plates and he goes "Oh shit! Don't worry, I'll replace it."