Finally pulled the trigger (rent, house, tenants)

[eastcoastbias]

Originally Posted by Sassberto

Thanks all... we are still deciding what to do with the old place... my wife wants to keep it, I want to sell, but could go either way. It's being painted and some repairs done right now so I am running out of time to make a decision, lol.

New house was built in 1969 with a major remodel that occurred in the early 2000's. The biggest things we saw were unrenovated homes, or houses that had been used as rentals and were just thrashed. The major problem with our home is it has an original roof and some decking that is rotten and needs to be ripped and replaced (about 20k job), as well as a few odds and ends (some windows and some appliances need to be replaced). Overall it's in good shape, certainly compared to what we saw in our price range.

Hitman my preference was to move out of City of SD at all costs but given are kids attend an SDUSD school we wanted to be close so that ultimately won out.

I'm curious why folks selling now aren't fixing up a little and putting on the market- why not put 5-10K in a home over a month and double it?


You are probably in great shape to sell now- given the inventory out there. I have a friend just like your situation ACTIVELY TRYING to spend money and getting in multiple offer situations at the tail end of sales. The little that is out there is going quickly.

[cruitr]

If your rent cashflow on the old place is breakeven or close, I'm with your wife. Keep it. You're in a good area with lots of long-term potential. However, being a landlord ain't easy but it does give you lots of tax writeoffs. We kept an old home as a rental for over 30 years. We're glad we did.

[CNYC]

Congratulations.

If I was closer to you I'd smash a bottle of champagne over your doorstep to christen your house. Although I think a handshake would be more appropriate.

[LuvSouthOC]

Originally Posted by Sassberto

Bought a house in San Carlos right near my kids school. Moved in over the weekend... wasn't cheap and needs work but it's like night and day compared to the old house. A lot more space, quiet, low traffic and plenty of kids in the area.

It wasn't perfect but we came to realize nothing is even close.

Congrats man, that's a nice area.

[NYSD1995]

Originally Posted by eastcoastbias

I'm curious why folks selling now aren't fixing up a little and putting on the market- why not put 5-10K in a home over a month and double it?


You are probably in great shape to sell now- given the inventory out there. I have a friend just like your situation ACTIVELY TRYING to spend money and getting in multiple offer situations at the tail end of sales. The little that is out there is going quickly.

Ultimately it's a question of take the cash now or 3x in the next 10 years. If you don't need the cash, it doesn't do you any good sitting in a bank account making .25%

[echo42]

Originally Posted by Sassberto

Ultimately it's a question of take the cash now or 3x in the next 10 years. If you don't need the cash, it doesn't do you any good sitting in a bank account making .25%

I am a reluctant landlord. I never meant to get into real estate as an investment but circumstances presented themselves. Being a landlord is not the greatest thing in the world and at times is a downright pain in the backside. Don't get me wrong, we've done well and the tax breaks have been considerable.

One thing that is a challenge is the fact that if we sold the rental any appreciation proceeds would taxed as capital gains, somewhere in the vicinity of 22-24% (including CA's taste), whereas a primary residence qualifies for the exemption. I think you have a period of a few years to get the exemption. I'm not sure if I articulated that well...but I guess it is a good problem to have.

[mauialoha]

Hosewarming Party at Sassberto's place!!!!!! seriously, congratulations
Dave

[kettlepot]

Congratulations Sassberto!

I'm sorry we're not living as close to each other as we used too, but I hear San Carlos has good potential. Realtors/Flippers have been sniffing around that area for about a decade, waiting for the original owners to "move on" and then repairing and upgrading the original homes for a newer market. I think you will do well.

As for the old place, maybe it would be worth your while to hire a management company.

[futbol]

Congrats Sassberto!

+1 on renting the previous house if you can swing it.
+1 on using a rental management company, if they are experienced and reasonable. 10% of rent is the a realistic expense, correct?

[NYSD1995]

Originally Posted by echo42

I am a reluctant landlord. I never meant to get into real estate as an investment but circumstances presented themselves. Being a landlord is not the greatest thing in the world and at times is a downright pain in the backside. Don't get me wrong, we've done well and the tax breaks have been considerable..

I'm definitely reluctant.. but I have an exceptional ability to tolerate pains in the backside when there is $$$ on the other end