Updated about 9 years ago on . Most recent reply
Renting former principal residence- first time landlord
I have purchased a new home and intend to rent my current house. Cash flow will be neutral to slightly positive, but the Tampa market seems to be finally rebounding. My goal is to capture the appreciation that will likely occur over the next few years and accept the limited income (for now). Thoughts.
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Loring Hinds My few thoughts...
Don't bank on appreciation, think of it as icing on the cake when all other things go in your favor. Do the math, what "if" it appreciates 2,3,5,8,10%? And how many years will it take? How will you exit? 1031Exchange? Sell and pay depreciation recapture tax and capital gains taxes? Then what do your numbers look like?
Cash flow neutral is risky. Be sure to have cash reserves to cover the mortgage and repairs. Are you self-managing?
Separate yourself from the house emotionally. It was your home with your memories now a tenant will be there.