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JTK
my 4 boys!
Member since 6/06 7396 total posts
Name:
Kristi
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a question for those who follow real estate
Ok so DH and I are in a situation. We bought our house 3 years ago, somewhat in the height of the market although we bought "smartly" and did our own renovations. Obviously, our house has declined in value.. but maybe only about 30,000. OUr situation is that we inherited a house about 3 years ago which my DH tore down and is in the process of rebuilding it to our "dream" home. (DH is a contractor) .. we have cash in the bank and so far the house is being built from that and we dont' anticipate having to take out too much to finish it in a loan, so we will eventually have little to no mortgage on the finished product. Although, it'll leave us close to broke in the bank lol. So, what would you do with the house we are in now? would you sell? take the loss? take out a loan to finish paying the 30000 we could lose on it? Rent it? and hope for a better market in 5 years but meanwhile making up the difference of what we could get in rent to what our mortgage payment is.. which would be about 1000 dollars a month? Walking away is NOT an option nor is a short sale, both my DH and I have good credit which we are not willing to forfeit and we have never been late on a payment and have plenty of money in the bank so i doubt anyone is renegotiating our terms..
thank you for all who have kept reading.. i'm so confused!
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Posted 1/4/09 2:43 PM  |
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sunnyplus3
:)
Member since 11/05 8749 total posts
Name:
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Re: a question for those who follow real estate
I would keep it as a rental & kick in the difference every month. Possibly consider a rent to own option.
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| Posted 1/4/09 2:45 PM |
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Beth
The Key to your new home....
Member since 2/06 24849 total posts
Name:
Beth
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Re: a question for those who follow real estate
I would hold it and rent it until you could sell it for a profit or break even
I wouldn't sell it for a loss unless you had too
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| Posted 1/4/09 2:46 PM |
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Blu-ize
Plan B is Now Plan A
Member since 7/05 32475 total posts
Name:
Susan
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Re: a question for those who follow real estate
Rent it. I believe you may be able to write off some portion if the deficit in the rent vs what your mortgage is. I'm looking into this right now and I'm certainly not an accountant.
I think that you could hold onto your first house for a few more years. I agree with the rent to own aspect of it.
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| Posted 1/4/09 2:48 PM |
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Octobermom
LIF Adult
Member since 1/09 972 total posts
Name:
Anna Maria
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Re: a question for those who follow real estate
I would rent it also...... and pay the difference. Real estate is always a good investment long term.
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| Posted 1/4/09 2:48 PM |
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JTK
my 4 boys!
Member since 6/06 7396 total posts
Name:
Kristi
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Re: a question for those who follow real estate
i know it's just a prediction.. but how long before we start to see an increase in the market?
interesting about writing off part of the payment.. i'll have to look into that.
i don't know much about rent to own.. but doesnt' that mean i would have to finance someone else?
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| Posted 1/4/09 2:51 PM |
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sunnyplus3
:)
Member since 11/05 8749 total posts
Name:
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Re: a question for those who follow real estate
you'll need to talk to your tax pro about the write off, there are scenarios when it works.
As for the rent to own, you have a lease that indicates a portion of the rent money that goes toward the future Down payment, so when the market comes around & your tentant may have improved their credit score or saved more money you will sell them the house for a lower price that reflects the money you "set aside" as their DP. And you may not have to wait for the market to rebound entirely to make it worth selling.
Most rent to owns are totally in favor of the landlord & tentants never have any recourse for getting money back if things don't work out. Most real estate lawyers could help you right a lease agreement that would work.
As for when the market will turn around, a lot depends on the area of LI & what the price point on the house is now. I think that 5 years is a reasonable length of time to see values near 2003-2004 levels. I also think the lending industry will have balanced out a bit by then & fair products will be available to borrowers
Message edited 1/4/2009 3:04:31 PM.
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| Posted 1/4/09 3:03 PM |
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Re: a question for those who follow real estate
Posted by Beth1210
I would hold it and rent it until you could sell it for a profit or break even
I wouldn't sell it for a loss unless you had too
ditto. with all of the people that are in foreclosure on their homes, theres been a huge increase in the rental market.
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| Posted 1/4/09 5:39 PM |
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JTK
my 4 boys!
Member since 6/06 7396 total posts
Name:
Kristi
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Re: a question for those who follow real estate
Posted by waiting4ablessing
Posted by Beth1210
I would hold it and rent it until you could sell it for a profit or break even
I wouldn't sell it for a loss unless you had too
ditto. with all of the people that are in foreclosure on their homes, theres been a huge increase in the rental market.
that's great to hear.. i was thinking that we would have trouble finding a renter because the interst rates are so low and so are the prices of houses... so everyone would be buying..
then again wouldn't i want someone with decent credit renting?
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| Posted 1/4/09 6:20 PM |
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SpiceGirl
Dream big
Member since 1/06 2486 total posts
Name:
j
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Re: a question for those who follow real estate
Rentals are huge now. Even with it being a buyer's market...a LOT of people simply do not qualify for a home mortgage, so they rent.
My friend rents out her 3BR home for $2100 a month.
In the end, you need to do what is right for your family, but I think you should wait it out and don't sell at a loss.
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| Posted 1/4/09 7:57 PM |
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lululu
LIF Adult
Member since 7/05 9511 total posts
Name:
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Re: a question for those who follow real estate
Definitely rent for a couple of years. Also, you might want to see if you can re-fi. I also bought three years ago and while our rate is good, in a couple of weeks if rates drop we will look to re-fi.
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| Posted 1/5/09 8:47 AM |
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Kidsaplenty
Sister love
Member since 2/06 5971 total posts
Name:
Stephanie
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Re: a question for those who follow real estate
Could you afford to pay the full mortgage payment if your tenant stopped paying, or the home was vacant for a while? Do you want to deal with the stress of being a landlord, fixing things and maintaining the property?
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| Posted 1/5/09 9:43 AM |
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