Home Selling in Renton>Question Details

Kimberly Her…, Home Owner in Renton, WA

Do you think I should rent or sell my home? Thanks for your help.

Asked by Kimberly Herndon, Renton, WA Fri Jan 25, 2013

I own a small home in Renton that was built in 1958. It is in great shape now that I've made a lot of repairs over the last 7 years of ownership. It has a new roof, water heater, furnace and plumbing. I also updated the interior. I currently rent my home and my renter is moving out in May 2013. I don't enjoy being a landlord, but I have put so much money into the home and the market is now much lower than when I bought it so I am considering keeping it. It looks like if I were to sell now that I might just break even with the mortgage still owed, losing my $60,000 down payment. My concern is that you just never know what a renter will do to the home or what the future costs might be. I also know that the market might continue to go up by May or over the next several years.

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Maria China Krismer’s answer
You are right. There is that lack of assurance as to what a renter would do to your house and tenants can cause a lot of damage. If you are not entirely comfortable renting, then that would point in the direction of a sale.

The only way to answer your question of whether you should cut your losses now or later can only be answered by you. Your loss in terms of the responsibility of being a landlord, your time and liability, the risk of holding to the house with the assumption of market improvment is just like predicting that the stock market would definitely go up next year without a single doubt.

Best scenario for you is to have a consultation with a Realtor and assess your potential loss if you sell today. Rather than focus on gain or loss, you might want to focus on how much cash you would get from the sale, or how much cash you would have to pay to close if you have negative equity.
1 vote Thank Flag Link Sat Jan 26, 2013
If I were in your shoes, I would continue to rent it. I believe Renton is quickly climbing into higher values. I would put another renter into the home, use a property manager http://(www.rentersmarketplace.com) so you don't have to deal with it, and wait one year. I think the difference will be dramatic and you won't lose any money. Also make sure to keep the renter on a 1 year lease term as May/June are the best times to put your home on the market. Call me to help. My office is in Renton and I specialize in helping investors get their home rented. I have a few myself.
1 vote Thank Flag Link Fri Jan 25, 2013
My advice as of the market right now is to hold and rent. With the market going upwards for sellers and rental rate staying pretty stable. I understand you do not like being a landlord and my suggestion would be to examine your lease and see how detailed and supportive of your goals it is. You may want to add a monthly inspection and if the house is not clean and kept up then you will be able to take action. Usually if you make your renters aware of what can damage them in a lease, they will respect and care for your property to the fullest. You could even extend your current tenant to a month to month after their lease is up if you are comfortable and happy with them. Watch the market and speak to an agent to obtain a CMA.

Those are my thoughts... sorry if they are drawn out.
1 vote Thank Flag Link Fri Jan 25, 2013
I think you know what is best now that you have answers form many of us. Just be very careful to rent to someone that has money & you feel real good about. Do not compromise!

Good luck to you in any case,
Jirius Isaac
Isaac Real Estate Team
Champions Real Estate Services
TriStar Finance #MLO-107799
Office: 425-483-6849 Cell: 206-841-9976
Winner of Seattle Magazines 5 Star
Real Estate Agent Best in Client Satisfaction Award
Mortgage Loan Originator Best in Client Satisfaction
0 votes Thank Flag Link Fri Jan 25, 2013
I would suggest holding and renting the house, but you havent shared how much, if anything, you're making a month by renting.

Two options if you continue to rent are:

1. buy a home warranty that covers major repairs and some replacements (check out American Home Shield). When a covered item breaks, the tenant calls an 800 number, and a repairman is sent out. The serice call cost is $100. Anything above that is paid through the insurance. If certain items can't be repaired, they are replaced or an allowance is given for replacement.
In our leases, the tenant is responsbile for repairs up to $100 per occurance, so the landlord wouldn't even have to pay the service call. The insurance, for a year, will cost in the $500-600 range, dependng on what coverage you select.

2. If you don't like "being a landlord" - you can hire a property manager - my company gets 10% of the rent to handle that - collect rent, oversee repairs, and handle all other management responsibilities.

Good luck!
0 votes Thank Flag Link Fri Jan 25, 2013
If the market is going to affect your profit that much then rent it and hopefully it will rebound over the next few years.
0 votes Thank Flag Link Fri Jan 25, 2013
My opinion is rather simple;
Wealth is grown by accumulating assets, not selling them.
0 votes Thank Flag Link Fri Jan 25, 2013
Hi Kim,
Well I certainly hear you about not enjoying being a landlord - you are not alone.

You mention taking a loss considering what you put down on the property and what you have put into it .I'm curious as to what you think it would sell for and on what are you basing that information? Has a current competitive market analysis been prepared for you by a Realtor (or perhaps more than one?). If not, I'd be happy to do one for you. Just know if you are basing your projected sales price on your assessed taxed valuation or a figure from some other website, just know they are seldom accurate. I

The market started picking up last year and inventory is currently down and prices are on the rise throughout the region, some locations of course are hotter than others. Renton has had a greater supply comparably, than most however. If your home is located within the Issaquah school district, it may command a higher price point.

Please feel free to contact me if you'd like to discuss your options further. I'd be glad to be of help!
All the best,
Christine Viernes Realtor/Broker
Coldwell Banker Bain -Kirkland
0 votes Thank Flag Link Fri Jan 25, 2013
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