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View Poll Results: Keep the condo and rent or sell it?
Keep and Rent condo 9 81.82%
Sell it and put money toward new mortgage 2 18.18%
Voters: 11. You may not vote on this poll

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Old 01-29-2014, 06:02 PM
 
Location: Coastal Northeast
16,739 posts, read 23,184,751 times
Reputation: 5852

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Hi all. Our family has had a condo in Venice for years now. We absolutely love the town and since our family is growing, we have decided to upgrade to a house. The house is currently being built in a community off of Venice Ave.

We're at a crossroads. Wife wants to sell the condo, husband wants to keep it and rent it out yearly. We have no mortgage on the condo. If we sold, we would just about break even, but may lose a few thousand.

I'll include a poll in this, but please offer your opinions based on your knowledge of the market in the Venice area.
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Old 01-29-2014, 07:33 PM
 
2,089 posts, read 2,519,858 times
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My opinion is based on real estate knowledge in general.

I say keep the condo and here is my rationale.

Interest rates are at historic lows. If you get a fixed rate mortgage for the new place, it makes sense to mortgage 70-80%. In my opinion inflation is around the corner. That means that dollars will become worth less in buying power. You will be paying off fixed expenses (mortgage) with cheaper (worth less) inflated dollars. After you have had a mortgage for 10 years it starts to seem really cheap.

The other aspect of inflation is that the value of your condo should go up with inflation. In inflationary times, people try to put their cash into hard assets that will go up in value like gold, silver, collectibles, real estate, cause if they put their money in the bank it loses value (prices rise at a higher rate than bank interest). Hard assets keep up with inflation. It is very likely that in 7 years, your condo will be worth double what it is today. If you sold it then, you could pay off a big chunk of your mortgage and reach debt-free status early.

There have not been enough homes built in the last few years to keep up with population growth. Demographics suggest that people are leaving high tax states to Florida and Texas. A gazillion baby boomers are retiring and many of those are current snow birds who anticipate living in Sarasota permanently. They aren't making any more land at the beach so the value of existing property will rise. We are talking about housing shortage and higher demand in certain areas. You are seeing the early sign of this in increasing rents in Sarasota.

I just can't see any way that your property won't go up, unless you have flood zone issues. If you are in a flood zone, then sell.

The other thing that would change my opinion, is if you are stretching yourself to the max to buy the new house and your jobs aren't secure. In that case, a lower mortgage would be an excellent idea. You don't want to be house poor. If that is the scenario, you are better off to sell the condo and have a smaller mortgage on the house.

If you do keep the condo, when everyone starts to talk about how much their properties have appreciated, it is time to sell. Watch the interest rate cycle. (1) Rates will go up to reduce inflation. (2) Then when inflation starts to come down, rates will go back down. New buyers will come out of the wood work then. (3) A year or two after interest rates come down will probably be the peak of that real estate cycle. It is always good to sell high, but don't hang on too long cause the party doesn't last forever.

Good luck and honestly there is no bad decision here. Your choices are good and better.

Last edited by Cardiff by the Sea; 01-29-2014 at 09:00 PM..
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Old 01-30-2014, 06:18 AM
 
Location: Port Charlotte, FL
3,961 posts, read 8,526,133 times
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Keep the condo as a real estate investment and continue to rent it out as long as you are making money on it. It will help with retirement.
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Old 01-30-2014, 10:48 AM
 
Location: Michigan
37 posts, read 59,876 times
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I concur with Cardiff. Assuming you have no deed restrictions,and you can get renters reliably.
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Old 01-30-2014, 11:01 AM
 
Location: Lakewood Ranch, FL
5,336 posts, read 8,192,426 times
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I agree with Cardiff, too, if you are inclined to take the long view. Keep it and rent it would be my first choice.
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Old 01-30-2014, 11:57 AM
 
Location: Coastal Northeast
16,739 posts, read 23,184,751 times
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Awesome, thanks for the replies. You guys are great.

One more questions since you all know SW FL better than I do... if we decide to rent the place annually in Venice, do you think people would be more interested in furnished or unfurnished?
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Old 01-30-2014, 02:16 PM
 
Location: Lakewood Ranch, FL
5,336 posts, read 8,192,426 times
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It depends on how you plan to rent it. If seasonally, keep it furnished. If you want an annual tenant, odds are extremely high that he or she will have their own stuff.
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Old 01-30-2014, 05:46 PM
 
Location: Coastal Northeast
16,739 posts, read 23,184,751 times
Reputation: 5852
Quote:
Originally Posted by bbronston View Post
It depends on how you plan to rent it. If seasonally, keep it furnished. If you want an annual tenant, odds are extremely high that he or she will have their own stuff.
Yeah, that's what I figured. Thanks again!
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Old 01-30-2014, 06:07 PM
 
2,089 posts, read 2,519,858 times
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So how is Wife reacting to the direction of the vote?
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Old 01-30-2014, 06:58 PM
 
Location: Sarasota Florida
1,236 posts, read 3,610,121 times
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Cool I like Venice

After my Oregon place is sold, I will be looking to rent a long term furnished 2/2 or larger, in either Venice, Sarasota or Bradenton. I want to find a Town Home, or ground floor condo WITHOUT carpeting which is pet-friendly for myself and Jack, the rambunctious Rat Terrier. So, IM me if you go that route
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