Sale it or Rent it?

[Tominftl]

I wouldn't rent it. Suppose your maintenance goes up? What if you get assessed? What if something breaks or needs replaced? Lots of what if's and only collecting $2,000 a month? You'll have to save for those potential problems then.

[WithDisp]

I'd sell. That's a lot for the Waverly.

This would have to be some spectacular unit to warrant $2K a month in rent.

[evilcart]

Originally Posted by tennis32801

Need some opinions if I should sale or rent out my place. Im moving to another city and own a condo in a highrise building in downtown Orlando. Here are some facts:

Bought my condo for $320,000. I put down 20% when I bought it. Have 18 years left on mortgage. I want to sale it for $299,000 (initially without realtor). I still owe $210,000.

If I rent it out, it be $2000/a month.

Reasons for selling it: less stress looking for tenants every often, I would potentially make approx. $65 (assuming closing costs, possible realtor fees), I can use that money to purchase a house in the future (sorta tire of paying HOA fees), downtown is building a lot of apartments that may competes with my condo in the future.

Reasons for renting it: possible quicker turn around time for me to move, I already invested 12 years into mortgage, I will own something if I ever come back to Orlando, house value may continue to go up and I can sell later.

Any opinions welcome, thanks

It depends is my best answer...

*are you likely to come back to the area? - if not maybe buy where you are going...

*Might you need the monies in the next 5 -10 years? - if you do you could be forced to sell at a bad time.

*Are rent increases likely to make it profitable in a reasonable time frame? - if zoning is light weight many more units could hold rents down.



*What is your opportunity cost? Could you take your profits and invest them elsewhere for a better return?

*Do you see value in RE as part of a diversified portfolio?



Unless you can answer most of these you are opening a can of worms.

Asset appreciation is a valid reason to hold the property, but be aware a strong RE investment should be able to make a profit and see appreciation...



In my area far across the nation, investors are snapping up loss making properties with cash just to speculate on the leveraged asset appreciation. I view that like buying stock on margin but in slow motion.

[tennis32801]

Thanks all. I guess my hesitations for not selling it are the fact that I "only" have 18 years left on the mortgage (be nice to retire without a house payment, even I will have HOAs), and the price point that I can sell it for.

Btw, I am planning to move to DC, so theres no way I will (or can afford) to buy property up there.

And yes, $2K/month rent seems high, but that includes fully furnished, and there are studios in downtown Orlando (55 West) asking for $1400/month.

[WithDisp]

Originally Posted by tennis32801

Thanks all. I guess my hesitations for not selling it are the fact that I "only" have 18 years left on the mortgage (be nice to retire without a house payment, even I will have HOAs), and the price point that I can sell it for.

Btw, I am planning to move to DC, so theres no way I will (or can afford) to buy property up there.

And yes, $2K/month rent seems high, but that includes fully furnished, and there are studios in downtown Orlando (55 West) asking for $1400/month.

What people are paying for 55W and what people are paying for The Waverly do not necessarily correlate.
Furnished means little to a lot of people.
Not saying $2000 is out of the question, but it's a very high end for a building where 2BRs often go for $1800 or below.

[tworent]

If you like to lose money rent it there is no way this can cash flow.

[BPevehouse]

Tennis,

Portability is available to previous homeowners who purchase another home to be their primary occupancy in the state of Florida. Therefore there is no portability going out of or coming in from another state.

Portability is available to them for up to 2 years following the sale of their previous primary residence. There are other factors on how this is applied and carried forward, but not sure it is relevant to you. There are no benefits for those that do not homestead. But for someone who has lived in their home for 10+ years, and down-sizes or moves up to another home, the portability could save them THOUSANDS....


Regarding, ... "How will they know" I seriously doubt they are trolling these boards for those who are renting out their homes, but the counties and states have been cracking down on homesteading fraud. So I would NEVER advise someone to take the risk.
One could argue, your intent was to hold on changing homestead until next year, to ensure your job held out, but it would be wise to ensure your rental agreement backed this up. It simply could land you in some hot water with a hefty price tag and more trouble than it is worth.

WithDisp is correct in the statement of "Furnished means little to a lot of people" unless you are looking at short term rentals, which are a few weeks up to 6 months. This would likely be against your COA R&R and never anything I would suggest.
A furnished condo is appealing, and not unmarketable.. (pending review of the items & condition) but now you are seeking a sub-set of the rental market. More often, those that seek a furnished rental, are willing to live a minimalist means before paying a premium. Keep in mind furnished homes / condos are not a norm here so while you could offer it, I would only suggest it be an offer not a required condition of the tenancy.


Brady Pevehouse

[kyle19125]

Originally Posted by BrokerHarry

An imminent bursting bubble in the Orlando housing market seems to be one of Kyle's favorite predictions.

Yet RealtyTrac's first quarter 2015 data shows that 26% of Orlando-Kissimmee metropolitan area homeowners still remain seriously underwater, among the highest in the entire U.S.

Number of Q1 U.S. Homes Underwater Rises for First Time in Three Years

I interpret that data to suggest the Orlando real estate market still has quite a way to go in price appreciation before we re-enter bubble territory again.

Is today's stock market in bubble territory, ready for a correction? That might be a more likely possibility.

Is the greater metropolitan Orlando / Central Florida housing market currently in bubble territory?

I think not.

You fail to acknowledge what will happen if/when global markets have a downturn and the cash only-foreign investment buyers who have been driving much of the real estate sales in the Orlando metro area over the past few years disappear. The Orlando metro's residents cannot support a thriving real estate market alone with a salary-base that ranks dead last among the Top 50 metro areas and a similar lack of disposable income after housing costs to allow to save for any kind of downpayment for bank financing. What happens exactly when demand falls???

[BrokerHarry]

Originally Posted by kyle19125

You fail to acknowledge what will happen if/when global markets have a downturn and the cash only-foreign investment buyers who have been driving much of the real estate sales in the Orlando metro area over the past few years disappear. The Orlando metro's residents cannot support a thriving real estate market alone with a salary-base that ranks dead last among the Top 50 metro areas and a similar lack of disposable income after housing costs to allow to save for any kind of downpayment for bank financing. What happens exactly when demand falls???

No problem Kyle.

You believe a global downturn is imminent, & that the bottom is about to drop out of the Orlando housing market, & that we're in another bubble, about to burst. Run for the hills!

But MLS stats say Orlando housing is only now in its 3rd year of recovery off the lows we hit sometime around 2011. In most central Florida communities, the sale prices are still off substantially from the pre-crash highs.

I believe the Orlando housing market is still a great value, & still has a lot of upside potential. You seemingly disagree.

Let's revisit this subject a year from now, & see which one of us was right.

[everythingatall]

Originally Posted by tennis32801

Thanks all. I guess my hesitations for not selling it are the fact that I "only" have 18 years left on the mortgage (be nice to retire without a house payment, even I will have HOAs), and the price point that I can sell it for.

Btw, I am planning to move to DC, so theres no way I will (or can afford) to buy property up there.

And yes, $2K/month rent seems high, but that includes fully furnished, and there are studios in downtown Orlando (55 West) asking for $1400/month.

$2K per month rent won't happen. I can rent a one bedroom in a brand new high rise in downtown Chicago for that price. What other buildings are asking and what they are getting are two different stories. In general, people in Orlando who can afford $2K in rent per month are going to be purchasing a condo or home - not renting a furnished unit. If they are renting a furnished unit, it's going to be in corporate housing fully approved and paid for the corporation.

If you're willing to take a hit on the mortgage each month, I'd say that $1500 would be doable.