Should I Sale My house or stay |before the market crashes!
Hey, guys. Glad i found Bigger pockets. Sorry this is long but i really could use some insight
Here is my delima. I own a very large home I picked up in 2010 that has appreciated quite a bit in Atlanta. I live alone there and the house is really too big for me. The Neighborhood is B to C range but developing fast. Lots of contruction all around. Condos and new businesses and a multimillion dollar mixed use developemnt less than one mile away.
Right now the house its worth about 190k-200k range.
And the house is free and clear. I owe nothing on it. However, if the ecomomy stays put the houses in this area could easily get to 250-300-400k range in the next few years. Its already happened in similar areas around town.
My goal is to aquire two income properties. I wanted to buy two duplex UNITS to generate some rental cash flow and secure my furtue.
However, my credit is shot because a family memeber stole my social and when to town. And i have student loan debt thats pertty high.
So right now i can't borrow the captial to go out and invest. So here are my options and i would appreciate your help.
1. I could just sell the house, take the money and buy one of the rental properties. Get and apartment and be set. This would allow me to take the appreciation and utilize it to make me more money. Also i would not have to pay any capital gains since ive lived at the property for 3 years.
2. I could work on my credit and in a year or so, apply for a helock. Pull that money out of the house to buy an investment property.
[This method would be better in my opinion because i could just stay where I am and the mortage payment would be cheaper than what it would cost to get an apartment in the same area] Plus I could still take advantage of the appreciation happening in the area.
[My concern with this strategy is if the realestate market crashes, I could potentially lose alot of the appreciation and wind up getting stuck here before reparing my credit. I do not want to be in that scenario.]
3. I could rent the house out or airbnb it. Essentially, turning it into an income property. Then move to an Apartment.
[ my concern with this option is that because the house is so big and the layout not really functional for a rental or airbnb, I dont really know if renting this place will work unless I did a major rehab. Convering the 3 stories to apartment like units or something like that. Or just renting the whole house? Not to mention heating and cooling this house is very expensive due to the size. Not sure a rental situation would function here] But its possible!
Ideally, I am really considering the fact that we could be seeing a slow down in the housing market. I do not want my money tied up in this house when i could be getting cash flow. As a side note during the last econimic recession, lenders basically put a freeze on borrowing or made the bar very high to quality. I dont want to get stuck in that pickle.
I know no one can predict the market but i remember my dad lost half of his realestate portfolio when his houses plummeted in value. Another reason i am thinking i should pull that equity out now.
Any insight would be greatly appreciated :)
Thanks.