Should I Sell my Home?

Question

I moved into my home over two years ago and purchased it as a foreclosure. It was sold to us for 115k and since then we’ve been doing minor upgrades here and there like paint, ceiling fans, dishwasher, stove etc. We also had a new roof put in this past June.

I wasn’t really considering it, but while searching for tax sale investing I thought to look my own home up and see past tax histories. I searched for it on Zillow/realtor.com and it’s estimating the home around 150k-170k and homes in this area have recently sold for that range with similar structures.

Is there something I’m missing or is selling my home and purchasing something cheaper a good way to make some money? Or should I purchase a new home and rent out my first house? Neither of these were on my radar for investment opportunities so I thought I should ask.

Taylor L. · Answer

Zillow isn't particularly accurate in their price predictions. However, most markets have appreciated over the last 2 years. Chances are good your house would sell for more today than you bought it for. Then the question becomes..what do you buy?? You're just buying into an appreciated market, which doesn't necessarily do you a lot of good, unless you're buying another property that needs work.

If you're looking at buying another one and putting a tenant in your current house - great! Research and find out approximately what your house would rent for. Then do the math to see if that rent would cover all of your expenses (including repairs and the mortgage), and still have a few hundred dollars left over each month.

Theresa Harris · Answer

If you decide to rent it, you first want to see what the rental market is like, how much it would rent for and what the costs are (insurance, taxes, etc).  Also look at what your current costs are vs the costs of moving to a new house.