All Forum Posts by: Will Kanewske
Will Kanewske has started 1 posts and replied 3 times.
Quote from @David Ramirez:
Hey @Will Kanewske,
Like @Nathan Gesner said, your end goal determines your decisions on your way to obtaining it.
Something that you have to consider when renting a condo is the HOAs fees. They always go up and it tends to eat up your cash flow. If I were in your shoes, I would sell it and use that money to put a downpayment toward your primary residence and rental property. In today's market, since interest rates are high and there is more supply, you can negotiate a buy-down interest as a seller's credit.
Best of luck,
David
Good insights. Yes, HOA fees are a concern especially with an aging property. Condominium is 40+ years old and has a lot of maintenance coming due. I wouldn't be surprised if special assessments are in the near future as well as higher and higher fees.
Quote from @Polo Vazquez:
This is always a though decision to make. I was in this position once. I ended up selling but only because I was moving to a completely different city. You say selling your old home would allow you to make a large downpayment on your new home so you can have a small monthly payment, but you could use what is left over from your old house payment to offset that. The problem I see here is that you principal and interest is a bit high because you put the property on a 15 year loan. (I always advice my clients to get 30 years in case they end up on a scenario like this in the future haha) I would refinance the loan back to 15 years again to lower your payment. You won't be paying that note anyhow, your tenants will.
You could also just sell the house. I believe if you have lived there 2 out of the last 5 years then you won't need to pay any money on the capital gains. With the money buy two houses. This second option I think is more complicated and keep in mind you lose money on closing costs when you sell and then again when you buy.
Good points, yes the capital gain tax will be an issue. We lived at this condo up until a couple of months ago so at least right now we don't have to pay the capital gains. If we rent it for more than 3 years though, a large tax bill will be due. I think if we were to rent, we would only do so for a couple of years and then cash out then anyway to avoid the taxes. A $200K gain we would be nearing a $40,000 tax bill that would be nice to avoid.
Hello,
I have been stressing out and anguishing over whether to sell or lease my first home. Hoping some experienced folks can provide some insights!
My wife and I have lived in a condominium for the last 10 years. We bought the property for 155K, now worth 360K and could probably rent for $2200 - $2500. Our place is small and with a growing family, we can no longer live at this location. It is only 2 bedrooms, 1000 square feet, and has a long commute to my latest job. For now we have moved out and rented at a bigger place while we rehab the property and make some additional improvements that is also closer to my work. My struggle is trying to determine whether to sell or lease the property. On one hand, cashing out of this property and purchasing a nice home for my family is extremely appealing as I could put a lot down making our house payment much more manageable with larger interest rates. On the other hand, we had always planned on renting this property and by selling I feel as though I am quitting the game just as it was about to start.
The monthly financials look like this:
Principal / Interest: 886
Property Tax: 600
HOA: 350
Total Cost: 1836.
Mortgage is on a 15 year loan at 3.5 percent and it will be paid off in another 5 years.
Am I crazy for wanting to sell this now? I've never been a landlord and perhaps some of the worry is just the hassle of what will be required. I also worry that since it is in an HOA, there is a lot less control over certain matters and special assessments could certainly be required in the future.