To sell or hold in Denver

Buying & Selling Real Estate
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To sell or hold in Denver

Corriene McKeown
Sioux City, IA · Member since 2017 · 15 posts · 0 votes

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Hi Folks. 

I know the Denver market is complicated but looking from advice from experienced investors. 

Just wondering if you can help me settle an argument with my husband about what to do with our rental property we have in city park.

We bought the home in 09 and due to the economy we moved overseas. The house had been a rental since.

Now we have moved back to the states and have 3 small kids. We are living in Iowa in our modest vacation home and own a condo in the springs which isn’t doing great but breaking even.

Anyway due to the move and having 3 kids and husband job isn’t working out well we could use some extra income. We are getting by but deffeintly not ahead. Sick baby long NICU stay and such. 

I’d Ike to sell the DENVER house as we could cash out with about 300k.

We owe 172 k and could list 470k

Our accountant thinks we can get around the capital gains and get the 0% tax bracket due to his low paying job right now. Or even take a year off in 2018.

I don’t see how in the future when he gets back to his regular job we could avoid this and we would be back in that 20% tax bracket for gains.

He wants to make do with our savings and keep it as a rental as he’s sure it’s going to keep going up and we are going to loose this great investment.

I just don’t see it making gains as it has and yes maybe it will go up more but no way near the 140% it already has..

We would invest the money and get retirement stuff settled and possibly use some for a down payment on a family home once we figure out where we want to be..

We have also considered taking a home equity loan on it to make improments on or current vacation home and have some extra savings if needed. For the just in case. 

Any advice?? We just can’t agree

Thanks in advance

Corrie 

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Matt M.
Realtor · Denver, CO · Member since 2013 · 2k+ posts · 1k+ votes
8y

I'd sell it and move on if you are not coming back to Denver. Shore up your finances and get your safety net in place. Then once you are one more solid ground you can look to invest again. 

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  • Corriene McKeown
    OP
    Sioux City, IA · Member since 2017 · 15 posts · 0 votes
    8y

    @Ericka G. 

    Yes another pilot wife! 

    So you get the life style and the habit of collecting homes rather than selling 😂

    I don’t consider ourselves investors it just seems to happen like this. 

    The Denver house was our first home and right after we got married boutght the house, got his green card the economy went to crap and I left my well paying flight nurse job to follow his dream job in Asia. 

    He feels very strongly about not selling this house. It’s almost an obsession with him. 

    And yes it will cause a huge riff in the marriage. Especially that he will have to stay at his current local pilot job that doesn’t pay well in order to make me happy by being home more and also allow us to possibly get this once in a lifetime tax break.. that’s how I see it.

    I’m sorry you regretted selling.. you said it was very attractive to do so.. 

    can I ask why? 

    I’m just a bit worried about being finically strapped in the current situation and don’t really want another international move just to get ahead when we could in theory get ahead again by selling this home..

    Oh and btw thanks for the head up on the amazon thing. I had no idea. Been out of the loop of what’s happening in Denver for some time now 

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  • Corriene McKeown
    OP
    Sioux City, IA · Member since 2017 · 15 posts · 0 votes
    8y

    @Bill S. thanks for this tip!

    Makes it so much easier to reply to people. 

    Yes we have been living a rather lavish lifestyle in Asia and saving lots of money but due to my last pregnancy we had to relocate for better health care. 

    Thankfully baby and I are safe and healthy but the move and hospital bills and oh my the market place insurance I had to buy for us cost us so much of our safety net. 

    At his current job we won’t be able to build that up and I see us just going backwards right now. 

    While in Asia we saved money but haven't been putting money into my retirement accounts and ( husband is Australian so doesn't want to do much with one) he would rather have property. For some reason I'd like to have college accounts started and start putting back into my IRA

    And yes continue to live like we have been accustomed to but that’s really not feasible in the states. 

    I’m fine with living a modest life for a bit and holding off selling.. 

    we are staying in Iowa for that reason but it’s just a temporary solution. 

    And yes once he can take a better paying job we won’t want to sell. It’s just been a very stressful year for us all around. 

    He’s convinced that this house is our retirement/ kids college fund.

    I just can’t imagine it going up so much more and don’t like having all of our “ eggs in one basket” so to speak.. 

    I have thought about trying to run it as a job doing vbro to bring in more money but that’s more stress on an already stressed mom of 3. 

    I’ve called around and we are renting it out for way less than we should be so if I can improve that’s a start. 

    Yes no personal loans at all here and a refi didn’t seem like a good idea either. 

    And a HELOC makes me nervous..

    but so does carrying 3 mortgages..

    Thanks for the input. 

    I really thought I was going to find everyone telling me to sell while the market is hot.. makes sense to me but what you are saying also rings true! 

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  • Robert Herrera
    Investor · Denver, CO · Member since 2015 · 492 posts · 267 votes
    8y
    Corriene McKeown I am a little late to this party as well. Personally, I sold my house near the beginning of the year. I have been looking back at it to see if I sold to early. It seems to have actually dropped in the estimated price, and I would likely not got as much as before. That being said, $300k is an awesome amount to reinvest. You would see massive cash flow on more properties if you made an investment move. The real question is, what are you going to do when the market drops out, and now it’s back to what you bought it for? I’m sure neither one of you will be happy. It will drop out, and we are near the top. Not sure how much more your husband thinks it’s going to shoot up, but that boat already sailed. No way you will get that kind of market surge again here in Denver. If it falls, you will say “see we should of sold.” Then that will cause an argument since you just lost $200k+ in the market correction. Will sting, and resentment will sit in. If you sale, and the market moves up $50k more over the next couple years, I don’t think anyone is going to be that upset about securing your gains of $300k over hoping and praying it goes to $350k Gains. If you sale and the market drops out, you look like a genius, and will get all the praise. Personally I would sell, wait on the sidelines for the correction, and buy it back up at the cheap price, and ride that back up
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  • Thomas S.
    Member since 2016 · 13k+ posts · 12k+ votes
    8y

    It is obvious that your husband is only seeing future dollar signs and in a situation like that you will be banging your head against a brick wall trying to get him to change. All he sees is guaranteed future appreciation and there is no way he will ever change that opinion.

    Your beating a dead horse trying to change his thinking. Like all appreciation investors they choose to go through life with blinders on. For them investing in appreciation is as sure as the fact that the sun will rise in the morning.

    Let it go. The only possible chance you will ever be in 100% agreement is when you look back and agree you should have sold when the market was up.

    1Reply
  • Ericka G.
    Investor · Atlanta, GA · Member since 2015 · 366 posts · 283 votes
    8y
    Corriene McKeown I can totally relate to the unusual, nomadic pilot wife lifestyle and understand why you’d want to settle a bit now and have your hubby home more with little ones. I’d love to try living abroad for a while like you guys did. To answer your questions - our situation was very similar, selling was attractive because: $300k+ profit, a closing time window to avoid some big fees/taxes, and a year where we were a bit stagnant financially. I also had a very aggressive broker urging me to sell as he had a buyer ready go. Even though it made sense on paper to sell, I regret it. We came out of that flat financial period, I realized the broker was playing me, and we found another solution that would have avoided the fees and allowed us to keep the place another 3-5 years, but by then it was too late, I couldn’t back out. Based on my experience, I’d say don’t make a long term decision based on short term circumstances unless you both are at peace with the decision. You may not ever agree 100%, but if there is serious angst on his part about selling, hold on a bit longer. If you still feel as strongly about selling in 3 mos, 6 mos, or 1 year -decide together on a time to re-visit your options and go from there. It also boils down to whose feelings are more intense - is your need for more financial stability right now keeping you up at night more so than him selling before he is ready would keep him up at night?
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