All Forum Posts by: Mark Haney

Hi Jesse! There are three challenges I see with renting a house that big--1) the pool of renters looking to spend $2k+ is relatively small in our area, which means that you could be waiting a while (1-3 months) looking for the perfect tenant willing to spend that much. I don't think the price is unfair, it sounds like a beautiful home, but most people willing to spend that much on rent would just buy their own home in NWA. 2) Even if you did find someone willing to rent it, there is a higher likelihood that they are in a transition of some kind (recently relocated to NWA, recently sold home etc) which means you might have to repeat the process of listing again sooner than you would probably want to. 3) If you are thinking of this home now from an investment perspective, consider the returns you are getting based on your cash/equity in the project--if you could sell the home and reinvest that equity in a smaller SFH or duplex at a higher cash-on-cash return, that would probably be the smarter move and give you fewer headaches over time. If you go down that route, you could save on taxes if you wait to sell or rent until Mar 2020 when you hit 2 years of residence, that would allow you to sell it as a personal residence and pay no capital gains tax. You could even rent it for a while from Mar 2020 onward if you wanted, and you would still have the option to sell without capital gains tax as long as you did it before Mar 2023.

My gut says your could get a better cash-on-cash return and take on less long-term risk by selling the home and reinvesting in another SFH or small multifamily. Whatever you decide, good luck! It's a unique and challenging market we live in!