You have to ask yourself, would you buy the condo again for the amount you can currently sell. If you would, then keep it, if you wouldn't, then sell it. It's nice to be optimistic about real estate prices, but here in SB (Goleta) we've had such a run-up in prices over the past decade that a further correction is reasonable. Not to mention interest rates can't get much lower and will likely rise in the future, which will keep property values depressed as people will be able to afford less, at elast until real wages rise.

The new PMI Market Risk Index came out, listing SB/Goleta as a High Risk region at 98.6 (which translates to a 98.6% chance of lower prices in two years in the private mortgage insurance industry's estimation). The area is among the very worst of the 381 regions they study -- for instance Corvallis, OR is only at 38.6.

http://www.pmi-us.com/econ/

Melissa

A lot goes into this question and everyone has different circumstances surrounding it. I have worked with 4 short sales over the last year and each one again is a little different.

The first big question is roughly the spread of what you owe and what you could sell the property for. The larger the amount, the harder this is to do....generally.

The second big question is if you refinanced the property or not since you have owned it. If you have not then there are rules that help you and your are not "harmed" as much on your credit etc. Long story so it is easier to talk on the phone about this.

Regarding renting the property, it is hard to make a call on this since noone can guarantee you where the market will be in 1, 3 or 5 years. So this is a subjective call with simply trying to obtain the best info you can.

If you would like to talk about the market, your situation etc., just let me know. You can also visit my site and I have written articles about short sales etc.

take care
Kevin Schmidtchen
Sotheby's Int'l Realty
805-689-6877

Rent it out. You should have no problem getting a renter since you are right by UCSB

Melissa, we just can't assume the market trend, therefore, times call for practical decisions. Instead of taking the loss, if you think you can hold ownership by renting it out and are not in desperate need of the money, rent it.
Markets eventually will get back to normal; is just the when (?), we don't know.