 to sell rental or not (by sam [TX]) Dec 15, 2017 6:36 PM
 to sell rental or not (by Richard [MI]) Dec 15, 2017 6:48 PM
to sell rental or not (by Deanna [TX]) Dec 15, 2017 7:49 PM
to sell rental or not (by DJ [VA]) Dec 15, 2017 8:05 PM
to sell rental or not (by RathdrumGal [ID]) Dec 15, 2017 8:07 PM
to sell rental or not (by nhsailmaker [NH]) Dec 16, 2017 5:19 AM
to sell rental or not (by Andrew [ON]) Dec 16, 2017 6:19 AM
to sell rental or not (by myob [GA]) Dec 16, 2017 6:20 AM
to sell rental or not (by AllyM [NJ]) Dec 16, 2017 6:50 AM
to sell rental or not (by #22 [MO]) Dec 16, 2017 9:26 AM
to sell rental or not (by myob [GA]) Dec 16, 2017 12:22 PM
to sell rental or not (by Sam [TX]) Dec 16, 2017 1:11 PM
to sell rental or not (by sam [TX]) Posted on: Dec 15, 2017 6:36 PM
Message:
I have a tenant who's lease is up in 6 months. This is my weakest tenant and rental in terms of how she has taken care of my property and things she calls for, but she is a section 8 tenant so my rent is always paid. I am one year from having this property paid off. I am debating if I should sell the property or do some upgrades to rent property after her lease expires. I can probably do the upgrades for around 7 grand I am on pace to purchase 1 rental per year and would like to keep growing for several more years. I feel if I sell I am taking a step backwards and would lose one year, but with the funds from the sell I can get that one property back and possibly get 2 properties which means 2 more mortgages, but possibly more cash flow or pay for 1 property cash from the sell. My concern is that prices in my area are high and will not likely find the great deal. Any ideas or suggestions would be appreciated. --64.201.xxx.xx |
to sell rental or not (by Richard [MI]) Posted on: Dec 15, 2017 6:48 PM
Message:
We are near the top of the market for real estate prices in many areas. If the place has gone up in value it seems a good time to take profits near the top. Why not exchange it for something that needs rehab, do the rehab and gain the equity from doing the repairs as well as any increase from inflation. That way you get rid of the problem property and get one that you can make two levels of profit on. --23.121.xx.xxx |
to sell rental or not (by Deanna [TX]) Posted on: Dec 15, 2017 7:49 PM
Message:
I know I'm more cautious than many, but I'd be hesitant to sell something right on the border of it being totally free-and-clear, especially since you say it's only going to lead to two more mortgages. I'd be more likely to keep it, and find some other way to fund my growth, unless there was an intrinsic problem with the property itself, not the tenant. Like, the neighborhood was awesome 30 years ago, but now half the properties are abandoned and boarded-up. Or the school district used to be really awesome and sought-after 20 years ago, but it's full of gangs and drugs these days. Or something like that. But since you say prices in your area are high, I'm not getting that vibe.
Prices in your area are high. Is Section 8 giving you good compensation for your places? If you end your lease with the trashy tenant, does Section 8 send you a replacement tenant, or do you have to totally sever your Section 8 relationship in order to terminate the trashy tenant's lease? If Section 8 is giving you under-market rent, how much more profit would be involved if you got rid of the S8 tenant and rented on the normal market, regardless of the $7k renovation that would come with turnover?
It's easier to get into a desirable area before it's a desirable area, and when it's cheap, than to get into a hot market while it's hot. I wouldn't get rid of a paid-off house in a great location just because I wasn't fond of the tenant of the moment. --96.46.xxx.xx |
to sell rental or not (by DJ [VA]) Posted on: Dec 15, 2017 8:05 PM
Message:
I basically agree with Deanna. It sounds like the main thing wrong with the property is the tenant (and being associated with section8), so get rid of the problem & keep the paid-off house. Once the mortgage is gone, that will be additional profit every month that you can use for another investment if you want. Renovate enough to get maximum rent on the open market. 6 months from now will be a great time to get a new tenant --68.105.xxx.xxx |
to sell rental or not (by RathdrumGal [ID]) Posted on: Dec 15, 2017 8:07 PM
Message:
Read up on 1031 exchanges, so you will not be taxed on your profits on the sale of your rental. The 1031 exchange (and I know just enough to be dangerous) lets you move up to a more expensive property or a multiplex without paying capital gains taxes. You have to buy within 180 days of selling your first property. --98.146.xxx.xx |
to sell rental or not (by nhsailmaker [NH]) Posted on: Dec 16, 2017 5:19 AM
Message:
If you need to do 7K in improvements it is NOT ready to sell yet. --24.34.xx.xxx |
to sell rental or not (by Andrew [ON]) Posted on: Dec 16, 2017 6:19 AM
Message:
I think you are letting emotion cloud your decision. Dont worry about the tenant.
Is the PROPERTY a keeper?
Why not refinance the property, avoid sales costs and taxes and use the proceeds to buy the next property.
I would only upgrade the property if your current tenant leaves.
I dont know anything about your market.....but if you are holding long term, it wont matter if prices drop in the short term. --70.30.xx.xxx |
to sell rental or not (by myob [GA]) Posted on: Dec 16, 2017 6:20 AM
Message:
First what makes yo think your sec 8 is moving? that might be your next post.
Fact is whethe good or bad market it's tough to find a rental that pays. I don't like losing assests they take to long to give results so we hold. We are currently holding 60+ we had 80+ at one time. I'm going back 30 years here but there was an investor (book writter) called Wade Cook not even sure if he's around any more. His stradgy-- cash out use proceeds to buy more. Similar to what you ask. With the funding out there now we found that taking cash/mort out on rental and buying more rentals with that cash worked for us.
it comes down to this-- do I want 1 home for 100K that rents for 900.00 or 2 worth 50K each renting for 800 each? second which ones rent out quicker? --99.103.xxx.xxx |
to sell rental or not (by AllyM [NJ]) Posted on: Dec 16, 2017 6:50 AM
Message:
First time home buyers are getting grants to purchase homes. A woman I know and her son, who are marginal buyers just did that. It's an old home in an old town. I see that now she no longer works at the job where I knew her. People like this have a lot of ups and downs. Now that the weather will be cooler for five years due to solar minimum, the cost of heating their iffy homes will skyrocket and there should be a wave of foreclosures again in 2020 or a bit before. So it might be to your advantage to sell it as a SFH now rather than wait and see the market get soft again. Then you can pick up some of those homes as they come up for sale. Selling it might get rid of the Sect. 8 and at least you could purchase another and get market rent. --73.33.xxx.xxx |
to sell rental or not (by #22 [MO]) Posted on: Dec 16, 2017 9:26 AM
Message:
If your property will likely not appreciate, I'd sell and buy in a better area. I have a bunch of loser properties paid off and am having a hard time selling them at a large loss and there's no appreciation forever on them.. it really stinks. Appreciation can fix a lot of exit strategy problems. --70.195.xx.xxx |
to sell rental or not (by myob [GA]) Posted on: Dec 16, 2017 12:22 PM
Message:
#22 wait a minute? they're paid off-- are they empty? are people living there for free? how can you have free and clear property's and be worrying about appreciation?
Hint do some owner financing to new investors-- let them fix them up for their portfoolio- than when they get tired of it take um back.
I've gottin new roofs, interiors,carpeting- refreshed painting inside and out. Just did 6 that way. Deed in lieu of. --99.103.xxx.xxx |
to sell rental or not (by Sam [TX]) Posted on: Dec 16, 2017 1:11 PM
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Thanks to everyone for their time. --99.203.xx.xxx |
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