Contractor · San Antonio, TX · Member since 2019 · 26 posts · 7 votes
Hello,
I am kicking around the idea of renting out our current home and buying another SFR to live in. I have a family with small kids so I don't think going into a multifamily will happen. We have only been in this home for 1 year so our equity is basically nothing. This home is in NW San Antonio, TX.
The Numbers:
Built 2007, 1280 SqFt 3/2/2
Original Loan Amount : $167,000 - 08/2018
Outstanding Principal : $164,500
Term and Interest : 4.75% 30 year fixed rate FHA Loan
Mortgage payment with insurance, pmi, taxes : $1345.00
Since buying, we have put in new kitchen appliances, extended the back patio and put a roof over the patio. We plan on renovating the bathrooms and replacing all bedroom carpet with hardwood or faux-hardwood tile.
Even after finishing these updates to the house, I don't think it will have appreciated enough to refinance (thinking BRRR). Other larger homes (2000-2500 sqft) in the neighborhood hood stay around $100-120 /SqFt.
My Question is, if I can rent this out for $1600/month would it be worth the trouble? we know we don't want to stay here longer than another year. Let me know what you think, I'm open to ideas
Depending on which part of NW San Antonio you're in, that $1600/mo figure could be feasible. The question will come down to whether you think it's worth the effort for the $250 per month (before maintenance, any utilities, vacancies). On the plus side, you'd at least be paying down the mortgage. Even though you're a contractor (with easier ability to make cheap upgrades), I'd be careful about the renovations you're considering unless you really think it will increase what someone is willing to pay to rent the place. In any case, renters are rough on hardwood floors. Best of luck!
Depending on which part of NW San Antonio you're in, that $1600/mo figure could be feasible. The question will come down to whether you think it's worth the effort for the $250 per month (before maintenance, any utilities, vacancies). On the plus side, you'd at least be paying down the mortgage. Even though you're a contractor (with easier ability to make cheap upgrades), I'd be careful about the renovations you're considering unless you really think it will increase what someone is willing to pay to rent the place. In any case, renters are rough on hardwood floors. Best of luck!
My thoughts are that I would be paying down the mortgage while also moving on tho something else that would be a better deal in the short term. I am just trying to figure out how to make the numbers work and I am leaning towards renting it out if I can find a good tenant.
Hey @Christopher Lessing, my question is why did you buy retail and still have repairs that need to be done? At that 6 to 10 year age of a house, things start to go wrong. a/c goes out, faucets start leaking, carpet gets worn out.
If you are going to rent, dont do a rehab on the property. Even with the rehab, 1600 for 1200+sf is not going to happen. There are 1800 and 2000sf houses that are asking $1500 up to $1695 per month. Across Shaenfield, 1800sf houses are asking $1400.
You have a low mortgage payment, stay where you are.
Rick, sadly I agree with you. We bought at a hot time in the market and we're emotionally invested getting a home before school started for the kids. I guess we will ride it out for a few years while looking for other ways to invest.
The area is nice. You have a beautiful park right down the street with over twelve thousand acres!!! You can get an annual family pass for peanuts so that you can go there whenever you want. There are almost no people ever there!! The area is going to continue to grow. I dont see why you would want to move unless you found a super duper bargain somewhere else. But then again you could rent out the new bargain as your rental and stay where you are. Moving is such a pain. Just my .02c.
That's tough. In my opinion, it doesn't seem like it would be worth it unless you had a rockstar tenant. Even then, that $200 a month shouldn't be considered cash flow because, in my opinion, you should be putting in $100 towards future repairs and $100 toward future vacancy. I'm not familiar with how your area performs with short term rentals but that could be something to look into. Best of luck