Thinking of Selling my 2+2 condo - Is it a bad time?
Homeowner · Long Beach, CA · Member since 2018 · 11 posts · 1 vote
Thinking of Selling my 2+2 condo - Is it a bad time?
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Theresa HarrisPro Member
Member since 2019 · 15k+ posts · 11k+ votesQuote from @Clarissa David:
Quote from @Theresa Harris:
Quote from @Clarissa David:
Quote from @Theresa Harris:
Quote from @Clarissa David:
Quote from @Theresa Harris:
Talk to a local realtor or two as they will have a better idea about the market. You don't say how long you've had your condo, but for the HOA to almost double is not a good sign and suggests something is wrong with the management. I'd get out.
I had a condo I purchased to live in (my first place) and then rented it out. They kept having special assessments for various things and after a while, I decided I'd had enough of that and sold it. A few months after I sold, they had a dozy of a special assessment (in the millions) and I was so happy I sold when I did.
I've been in my condo for 5 years now.. and my HOA has gone up 5-10% each year since PLUS special assessments.
Then, I'd sell it now. While you may get a lower price in the winter, if you turn around an buy a home you will also be buying it at a lower price. If you can afford it, I'd suggest a single family home with no HOAs.
Eventually I would love to buy more properties, but I know I need to take one step at a time. The next property I hope to buy is one that could set me up for potential cash flow or house hack possibilities. What are your thoughts?
Look at a few homes that are for sale in your price range to get an idea of where that gets you. Then I'd probably sell, but only if you can buy another home. While the market is slow in many areas, it will go up again in the spring and the longer you are out of the market, the harder it will be to get back in.
so would you say, selling then renting in the interim is a bad idea?
If you rent, you are going to have to move twice (which may be fine); but most landlords will want you to do a 1 year lease. That gives you less flexibility to find a new place and move in.
21 Replies
- New to Real Estate · Sunnyvale CA and Maplewood, NJ · Member since 2022 · 257 posts · 161 votes3y
One way to look at it is since you are selling one place and buying another, the worse a time it is to be a seller on your current property, the better a time it is to be a buyer on a new one, and vice versa. So it would balance out.
That said, you would probably be replacing a mortgage at a lower interest rate on your current property with a mortgage at a higher interest rate on your new property, and that would really eat into all the savings you were hoping for. I would look carefully at that math as you decide what to do.
- 3yTheresa HarrisPro MemberMember since 2019 · 15k+ posts · 11k+ votes
Talk to a local realtor or two as they will have a better idea about the market. You don't say how long you've had your condo, but for the HOA to almost double is not a good sign and suggests something is wrong with the management. I'd get out.
I had a condo I purchased to live in (my first place) and then rented it out. They kept having special assessments for various things and after a while, I decided I'd had enough of that and sold it. A few months after I sold, they had a dozy of a special assessment (in the millions) and I was so happy I sold when I did.
- Homeowner · Long Beach, CA · Member since 2018 · 11 posts · 1 vote3y
Purchase price: $400k
Potential sale price: $540-$550k
Remaining principal &balance: $298k
- Homeowner · Long Beach, CA · Member since 2018 · 11 posts · 1 vote3y
Quote from @Nathan A.:
One way to look at it is since you are selling one place and buying another, the worse a time it is to be a seller on your current property, the better a time it is to be a buyer on a new one, and vice versa. So it would balance out.
That said, you would probably be replacing a mortgage at a lower interest rate on your current property with a mortgage at a higher interest rate on your new property, and that would really eat into all the savings you were hoping for. I would look carefully at that math as you decide what to do.
I’d probably sell, then hold on to my equity until I have a good deal… despite the interest rate because I know I can refi later on. My though process is, if I am still able to sell and make a decent profit, I can use the equity for when the market takes a turn… which could be possible in the next year or two?
- Homeowner · Long Beach, CA · Member since 2018 · 11 posts · 1 vote3yI actually met with my realtor and talked about this over dinner. He thinks if I sell now, I will still cash out decent equity.
Quote from @Theresa Harris:
Talk to a local realtor or two as they will have a better idea about the market. You don't say how long you've had your condo, but for the HOA to almost double is not a good sign and suggests something is wrong with the management. I'd get out.
I had a condo I purchased to live in (my first place) and then rented it out. They kept having special assessments for various things and after a while, I decided I'd had enough of that and sold it. A few months after I sold, they had a dozy of a special assessment (in the millions) and I was so happy I sold when I did.
I've been in my condo for 5 years now.. and my HOA has gone up 5-10% each year since PLUS special assessments.
- 3yTheresa HarrisPro MemberMember since 2019 · 15k+ posts · 11k+ votes
Quote from @Clarissa David:
I actually met with my realtor and talked about this over dinner. He thinks if I sell now, I will still cash out decent equity.Quote from @Theresa Harris:
Talk to a local realtor or two as they will have a better idea about the market. You don't say how long you've had your condo, but for the HOA to almost double is not a good sign and suggests something is wrong with the management. I'd get out.
I had a condo I purchased to live in (my first place) and then rented it out. They kept having special assessments for various things and after a while, I decided I'd had enough of that and sold it. A few months after I sold, they had a dozy of a special assessment (in the millions) and I was so happy I sold when I did.
I've been in my condo for 5 years now.. and my HOA has gone up 5-10% each year since PLUS special assessments.
Then, I'd sell it now. While you may get a lower price in the winter, if you turn around an buy a home you will also be buying it at a lower price. If you can afford it, I'd suggest a single family home with no HOAs.
- Homeowner · Long Beach, CA · Member since 2018 · 11 posts · 1 vote3y
Quote from @Theresa Harris:
Quote from @Clarissa David:
I actually met with my realtor and talked about this over dinner. He thinks if I sell now, I will still cash out decent equity.Quote from @Theresa Harris:
Talk to a local realtor or two as they will have a better idea about the market. You don't say how long you've had your condo, but for the HOA to almost double is not a good sign and suggests something is wrong with the management. I'd get out.
I had a condo I purchased to live in (my first place) and then rented it out. They kept having special assessments for various things and after a while, I decided I'd had enough of that and sold it. A few months after I sold, they had a dozy of a special assessment (in the millions) and I was so happy I sold when I did.
I've been in my condo for 5 years now.. and my HOA has gone up 5-10% each year since PLUS special assessments.
Then, I'd sell it now. While you may get a lower price in the winter, if you turn around an buy a home you will also be buying it at a lower price. If you can afford it, I'd suggest a single family home with no HOAs.
Eventually I would love to buy more properties, but I know I need to take one step at a time. The next property I hope to buy is one that could set me up for potential cash flow or house hack possibilities. What are your thoughts?
- 3yTheresa HarrisPro MemberMember since 2019 · 15k+ posts · 11k+ votes
Quote from @Clarissa David:
Quote from @Theresa Harris:
Quote from @Clarissa David:
I actually met with my realtor and talked about this over dinner. He thinks if I sell now, I will still cash out decent equity.Quote from @Theresa Harris:
Talk to a local realtor or two as they will have a better idea about the market. You don't say how long you've had your condo, but for the HOA to almost double is not a good sign and suggests something is wrong with the management. I'd get out.
I had a condo I purchased to live in (my first place) and then rented it out. They kept having special assessments for various things and after a while, I decided I'd had enough of that and sold it. A few months after I sold, they had a dozy of a special assessment (in the millions) and I was so happy I sold when I did.
I've been in my condo for 5 years now.. and my HOA has gone up 5-10% each year since PLUS special assessments.
Then, I'd sell it now. While you may get a lower price in the winter, if you turn around an buy a home you will also be buying it at a lower price. If you can afford it, I'd suggest a single family home with no HOAs.
Eventually I would love to buy more properties, but I know I need to take one step at a time. The next property I hope to buy is one that could set me up for potential cash flow or house hack possibilities. What are your thoughts?
Look at a few homes that are for sale in your price range to get an idea of where that gets you. Then I'd probably sell, but only if you can buy another home. While the market is slow in many areas, it will go up again in the spring and the longer you are out of the market, the harder it will be to get back in.
- Homeowner · Long Beach, CA · Member since 2018 · 11 posts · 1 vote3yGot it.
Quote from @Theresa Harris:
Quote from @Clarissa David:
Quote from @Theresa Harris:
Quote from @Clarissa David:
I actually met with my realtor and talked about this over dinner. He thinks if I sell now, I will still cash out decent equity.Quote from @Theresa Harris:
Talk to a local realtor or two as they will have a better idea about the market. You don't say how long you've had your condo, but for the HOA to almost double is not a good sign and suggests something is wrong with the management. I'd get out.
I had a condo I purchased to live in (my first place) and then rented it out. They kept having special assessments for various things and after a while, I decided I'd had enough of that and sold it. A few months after I sold, they had a dozy of a special assessment (in the millions) and I was so happy I sold when I did.
I've been in my condo for 5 years now.. and my HOA has gone up 5-10% each year since PLUS special assessments.
Then, I'd sell it now. While you may get a lower price in the winter, if you turn around an buy a home you will also be buying it at a lower price. If you can afford it, I'd suggest a single family home with no HOAs.
Eventually I would love to buy more properties, but I know I need to take one step at a time. The next property I hope to buy is one that could set me up for potential cash flow or house hack possibilities. What are your thoughts?
Look at a few homes that are for sale in your price range to get an idea of where that gets you. Then I'd probably sell, but only if you can buy another home. While the market is slow in many areas, it will go up again in the spring and the longer you are out of the market, the harder it will be to get back in.
so would you say, selling then renting in the interim is a bad idea? - 3yNicholas L.Pro MemberFlipper/Rehabber · Pittsburgh · Member since 2018 · 6k+ posts · 5k+ votes
what are the numbers now with you living there? what would they be if you left?
- 3yTheresa HarrisPro MemberMember since 2019 · 15k+ posts · 11k+ votes
Quote from @Clarissa David:
Got it.Quote from @Theresa Harris:
Quote from @Clarissa David:
Quote from @Theresa Harris:
Quote from @Clarissa David:
I actually met with my realtor and talked about this over dinner. He thinks if I sell now, I will still cash out decent equity.Quote from @Theresa Harris:
Talk to a local realtor or two as they will have a better idea about the market. You don't say how long you've had your condo, but for the HOA to almost double is not a good sign and suggests something is wrong with the management. I'd get out.
I had a condo I purchased to live in (my first place) and then rented it out. They kept having special assessments for various things and after a while, I decided I'd had enough of that and sold it. A few months after I sold, they had a dozy of a special assessment (in the millions) and I was so happy I sold when I did.
I've been in my condo for 5 years now.. and my HOA has gone up 5-10% each year since PLUS special assessments.
Then, I'd sell it now. While you may get a lower price in the winter, if you turn around an buy a home you will also be buying it at a lower price. If you can afford it, I'd suggest a single family home with no HOAs.
Eventually I would love to buy more properties, but I know I need to take one step at a time. The next property I hope to buy is one that could set me up for potential cash flow or house hack possibilities. What are your thoughts?
Look at a few homes that are for sale in your price range to get an idea of where that gets you. Then I'd probably sell, but only if you can buy another home. While the market is slow in many areas, it will go up again in the spring and the longer you are out of the market, the harder it will be to get back in.
so would you say, selling then renting in the interim is a bad idea?If you rent, you are going to have to move twice (which may be fine); but most landlords will want you to do a 1 year lease. That gives you less flexibility to find a new place and move in.
- Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes3y
It's not the best time to sell, but if you have enough equity and expect to sell under market value and still make a profit you should do it. This property is a money drain not an investment.
- Homeowner · Long Beach, CA · Member since 2018 · 11 posts · 1 vote3yCurrent mortgage: $1798
Quote from @Nicholas L.:
what are the numbers now with you living there? what would they be if you left?
rental income (house hack): $1000
HOA: $735
Total: $1533 (excludes utilities/expenses)
Purchase price of home: $400k
Remaining mortgage: $298k
if I were to rent, I’d like to keep it under my current monthly housing expenses of $1533 which I think is possible. I’m okay with renting with roomies in the interim. Next property I hope to buy has cash flow potential but I don’t think I can afford it without my equity. - Homeowner · Long Beach, CA · Member since 2018 · 11 posts · 1 vote3ySo overall, ultimately sell because this property is gonna make me lose money.
Quote from @Eliott Elias:
It's not the best time to sell, but if you have enough equity and expect to sell under market value and still make a profit you should do it. This property is a money drain not an investment.
- Real Estate Agent · Metro Detroit · Member since 2022 · 66 posts · 28 votes3y
It depends on your location. In Royal Oak (metro Detroit) I just sold a condo within a week of listing.
We still are short housing here. That HOA is high. If you do sell make sure your listing really hammers in what is included with that fee.
:)
- 3yNicholas L.Pro MemberFlipper/Rehabber · Pittsburgh · Member since 2018 · 6k+ posts · 5k+ votes
need a few more numbers - need to know what it would rent for when you moved out, and also all expenses. PITI and HOA are just two. Need capex, repairs, vacancy, property management, any utilities you'd remain liable for, etc.
if it would only rent for $2K obviously you'd be CF negative significantly every month since PITI + HOA alone is $2500+.
but maybe it would be $3K. and maybe the HVAC is brand new. or not.
that's what we need to know. we're still not dealing with actual numbers here yet.
- Homeowner · Long Beach, CA · Member since 2018 · 11 posts · 1 vote3yGot it. I’ll do my homework and get these numbers to figure it out.
Quote from @Nicholas L.:
need a few more numbers - need to know what it would rent for when you moved out, and also all expenses. PITI and HOA are just two. Need capex, repairs, vacancy, property management, any utilities you'd remain liable for, etc.
if it would only rent for $2K obviously you'd be CF negative significantly every month since PITI + HOA alone is $2500+.
but maybe it would be $3K. and maybe the HVAC is brand new. or not.
that's what we need to know. we're still not dealing with actual numbers here yet.
- 3yDrew SygitBusiness MemberProperty Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
can you find another tenant to rent out your bedroom? If you can get this to cashflow and buy another primary you can keep building your real estate empire.
Logical Property Management4.9459 Reviews - Homeowner · Long Beach, CA · Member since 2018 · 11 posts · 1 vote3y
Quote from @Drew Sygit:
can you find another tenant to rent out your bedroom? If you can get this to cashflow and buy another primary you can keep building your real estate empire.
The only issue i'd have with that is now turning it into a rental property.. and then I'd have to deal with all the HOA rules, and the HOA is quite strict.
- 3yDrew SygitBusiness MemberProperty Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
@Clarissa David if you can rent your bedroom to someone you know, you can still "keep" it as your primary as far as the HOA is concerned.
Logical Property Management4.9459 Reviews
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