General Area in Fair Oaks>Question Details

Sirenspan, Home Buyer in Fair Oaks, CA

Should we just sell our house or rent it out?

Asked by Sirenspan, Fair Oaks, CA Fri Sep 21, 2012

Trying to decide if buying a newer house in better location and renting out our other house is worth it for positive cash flow. We have a house with payment under $1000.00 and thinking of buying a house in another area because of school choice, and renting out the our $1000.00. The renter market price in our area is $1600 to $2000. We do have equity in current house if need to sale. Me & my wife have great jobs and can retire in five years. We are under fifty YOA and have two great children with one to start college in six years and the other in eight years. We are losing our mortgage tax write off more and more each year. We will need a better write off or pay much more in tax's. I would like to rent our house for positive cash flow and this will keep an asset for years to come. Is this worth the effort? Also, we will be ready to sale or rent out house in six to eight months while saving more money for more liquid cash for savings. We want to move out of current house for schools.

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Answers

5
Nenita Tee’s answer
In my opinion, I would keep the current house and seeing a positive cash flow. And you are planning to retire in 5 years. It may be wise to use part of the equity to buy another home that you are comfortable with the mortgage payment. Since the house market is still low and interest rate is still low, why not keep the old house and have another home that is low interest rate now.

However, consult your CPA of what are your options in tax write-off if you rent the first house and buy another one in better area for school location.

I hope I can help you of your plan. I am destined to help you buy a home or sell a home
0 votes Thank Flag Link Sat Sep 22, 2012
Here's the great news for homeowners in the area: since you first posted your question in September 2012, the average sold price for homes in Fair Oaks has risen from $267,000 to $362,000. That is a 35% gain! The average price per square foot over that same time period has risen from $147/sq ft to $191/sq ft, a 30% gain. Of course, these are overall numbers and do not take into account your home's condition and amenities. But we want to shout from the rooftops that for owners with equity, now is a great time to make a move! If you're still trying to decide what to do, I'd love to provide you the information you need to make the best decision for you and your family. Call or text me at 916-224-9240, or email me at mcaldwell@golyon.com. Good luck!
0 votes Thank Flag Link Thu Jul 17, 2014
I think you have a great idea and I would recommend keeping your current house as a rental if you can. Of course without knowing more about your situation, it is difficult for me to offer more specific advice, but generally, the longer you can hold on to your home, the better. Things have been improving price wise here in Fair Oaks and surrounding communities, and with a shortage of clean, non-distressed inventory, the trend will continue for a while longer. Of course, we will have a seasonal slow down, but I believe prices will remain stable and continue to show appreciation well into the next year. i would love to have a more comprehensive conversation about your specific situation where we can discuss all of the pros and cons. Please feel free to contact me at 916 967-1000
0 votes Thank Flag Link Fri Sep 21, 2012
i think most realtors would consider keeping the home for investment purposes, if it was their own personal decision AS LONG AS THERE IS SOLID POSITIVE CASH FLOW. It does require you to either secure a property manager to maintain the home and collect rents, or plan on doing it yourself.
One reason NOT to keep a property is if you cannot create an emotional disconnect from the home and see it simply as an investment. Renters will most likely not maintain the home the way you would, but normally with a little paint and flooring it's back in shape once they leave.

This is all to say it's a decision made based on your estate planning, tax advantages, and tolerance to view the home as a house, with little sentimental attachment. Only you can answer that question.
0 votes Thank Flag Link Fri Sep 21, 2012
Congratulations! Sounds like you are in a great position to make some exciting changes in your life. Keeping your current home for a rental and purchasing another home to live in with these crazy low interest rates makes a lot of sense. Of course, be sure to check with your accountant and/or tax advisor.
0 votes Thank Flag Link Fri Sep 21, 2012
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