Sounds like you are not a landlord. I would sell it. Market is good, prices are high, sky is blue. Tomorrow doesn't know. And, of course, sooner or later, tenants will disappoint. Good luck.
Sounds like you are not a landlord. I would sell it. Market is good, prices are high, sky is blue. Tomorrow doesn't know. And, of course, sooner or later, tenants will disappoint. Good luck.
If you have more than $100k in capital gains I would sell because they will be tax free today but taxable in 3 years if you change to to a rental. I just sold my first property ever for that exact reason. It’s a $430k single story with a 3 car and I could have done fine as a rental. But I got an offer from someone without a realtor and cleared $130k tax free.
I actually prefer expensive rentals, my most expensive is a $600k lakeshore townhome in MN. They’ve been there 4 years and I’ve heard from them twice. (A new microwave and a new garage door opener.)
@Karoline King Check to see if any of the town homes in your neighborhood are rentals and what they are renting for. How will that look on your balance sheet? Will it cash flow? Speak to a few PM in Georgia and see what they say. You may even run across a PM that already has property in your neighborhood.
You could refi although the rate will be higher for a cash out refi and even higher for a rental. I was simply talking about the $15k per $100k in equity capital gains tax savings that is only available to you now. It might take years for this property to make $15k?
@Karoline King Get a good tenant and a property manager if you aren't in the area. In some places, tiny, starter homes are $400K. So it isn't the price as much as the market and the numbers.
@Karoline King if you are unsure that you want to be a landlord (and it sounds like you’re unsure), then you should sell. Dealing with tenants long distance isn’t worth it for someone who isn’t fully committed to it. Even good tenants, which you’d presumably get with a 400k property can be bad if you don’t screen properly
@Karoline King It depends. I pay 8%, I know there is a range and I've heard people pay as much as 10%. To find a tenant I've heard people sometimes pay a full month's rent to the PM. Mine just charges advertizing fees.
Keep in mind, Georgia is one of the cheapest housing markets in the country right now. $400,000 buys you a lot in Georgia. The tenants you will attract at that price range has a lot to do with location. Where is the property located? If you are in the higher-end areas around Atlanta I wouldn't be concerned with a bad tenant. A 400k property in the more rural areas can be considered a high in property in this area. Although, I don't see getting 4K a month in rent in many places around Georgia. It all comes back to the location, where is the property located?
@Karoline King all depends on location because that’ll tell you the type of tenants you would attract, also you shouldn’t have a problem if you have a good PM company in place.
I just sold one of my townhomes in Alpharetta
Ga North of Atlanta area that i purchased in 2007, last tenant was there for two years and I didn’t even have to paint it to sell.
It depends on the numbers. You could have a $400k property that rents at $2.9k but your mortgage could be $3.5k. You gotta give more context to get a answer that would be beneficial.
Is there much appreciation expected in the next 5 years? How much is rent in the area? What would your mortgage be? There are several properties I wish I could have kept and rent out as they were in up and coming n’hoods. Not sure you’ll get the same in Roswell unless it’s forced appreciation
@Karoline King, people rent million dollars homes. There are renters at every class level, don't worry about it being a $400k home. Also, $400k varies market-to-market.
Atlanta real estate is cheap and larger, that's nice! If it's in great location and condition then you will probably attract great tenants. Often with higher quality homes the tenants are likely to stay longer. They will care more about their reputation and not want anything on their records.
Run the numbers. How much can you earn by selling? How much can you earn by renting? Then ask yourself how comfortable you feel about the market cycle and being a landlord.