Home Selling in 90808>Question Details

Cochrensmae, Home Buyer in Valencia, CA

I have inherited a home that is paid off in a great area. I have a lot of emotional ties to it as well but with work I am too far away to live in it.

Asked by Cochrensmae, Valencia, CA Sun Jan 20, 2013

I'd like to sell and pay full cash for my dream home by my work but I am also hearing renting would be good but then I am paying interest on a home (the new home)every month? What is better pay cash for a house or finance it and rent out the other one?

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Answers

16
Kawain Payne’s answer
Hello Cochrensmae,

I understand your ties to the home you inherited. I just sold a home where the original owner bought it 52 years ago. She past away last year. It took her daughter a full year to even bring herself to sale it. She was comforted by the fact that the buyers were a young family with a toddler and one on the way. They plan to raise their family in the home. The seller did not want to sale it to an investor.

As for the secondar part of your comments: The decision to pay cash or finance your new home is one best answered by your financial advisor, but I will give you my two cents worth anyway. If you plan to live in the home for a VERTY VERY long time, and you get a DEAL by paying cash, and you have the cash it may be a good idea to pay cash. If you are like many Americans and will move in five to ten years why spend YOUR cash. In this case you can finace the home with todays' low interest rates, and maybe invest some of your cash in another way
(of course after carefully consulting a financial advisor, not a REALTOR)

Best Regards,
Kawain Payne, Realtor
0 votes Thank Flag Link Mon Jan 21, 2013
This will be a difficult decision for you. I have experienced this many times with clients in the past. I will be very honest with you. In almost every situation like this the owner usually sells the home. Not many like yourself with emotional ties to the home can see themselves renting it out. Honestly, what if they do not take care of the home very well, or it becomes difficult for the renters to pay on time? These are natural questions to ask yourself. It hase been my experience that the person who llived there wanted you to have the home and or the proceeeds from the sale of the home. If you will not live there, then perhaps its best to use the proceeds of the sale to improve your immediate housing situation. It is a positve thing all the way around.

Let me know if I can help you. I have dozens of letters of recommendation here on Trulia. These will give you a feel for the level of service that I am able to provide my clients.

I wish you the best and hopefully we can talk soon.

Alex Montelongo/Broker
Coldwell Banker Star Realty
562-810-7387 Cell
DRE Lic#01456982
http://www.AlexMontelongo.com

http://www.AskARealtor-Ca.com

http://www.trulia.com/voices/profile/Real_Estate_Pro-Long_Be…

The Best Compliment that I can receive is a Referral from a Customer or Client.
0 votes Thank Flag Link Mon Apr 1, 2013
Call me 562.481.3849. I specialize in this area of Long Beach. As a local I can deliver outstanding service for your home sale. If you decide to rent I can help with the property management. Call me and I can help you calculate which is the better way to go. http://www.jeaninebirong.com
0 votes Thank Flag Link Thu Jan 24, 2013
Hi Cochrensmae,

First questions I ask sellers interested in renting out their home are:
1. How do you feel about being a landlord, getting calls at night because something broke or water is all over the floor?
2. How about spending time showing the home to prospective renters, checking out their credentials, handling late rent payments?
3. How would you handle a non paying tenant, or doing an eviction?

Being a landlord is not just collecting the money at the end of the month, it also entails unforeseen headaches, and legal problems. I know, I have been a landlord for many years, and even when you dot your Is and cross your Ts, things happen.

Talk to a certified public accountant to see what may be best for you financially, then make a decision.
Some people sleep better at night knowing that they have their money in the bank, and no tenant headaches.

Any questions, ask here on the board, or call me, I'm in LA's Westside and just a few minutes away from Valencia.

Douglas Lagos
Realtor, Certified HAFA Specialist
Coldwell Banker
0 votes Thank Flag Link Wed Jan 23, 2013
Great Question. If you have the Cash to buy your dream home that would be wonderful. Why rent if you can own your own home, why help pay someone elses mortgage if you can own your own home. On the other hand if you inherited a home that is own free and clear, you can get some really good income off of that if you rent it out. And if you can qualify to buy your dream home you can get a low interest rate loan. Talk with your CPA, Tax Accountant and they can help you decide which is the best option for you. Either way you are in a great position.

There are some more details that I need if you want more clarification call me (562) 673-0943. I hope this helped a little bit,
Lesley Harris, Realtor
Cal Tex Properties & REO
(562) 673-0943
LesleySells@gmail.com
0 votes Thank Flag Link Tue Jan 22, 2013
Hi, those are good questions that really need to be answered in a context of knowing more about your specifiic situation. I'd be happy to help answer all your questions so you can make the best decision possible. Either way you go, selling or renting, I can help. Feel free to give me a call.

John Zimmerman - RE/MAX Real Estate Specialists 562-706-1406.

CA DRE LIC # 01052025
0 votes Thank Flag Link Mon Jan 21, 2013
Dear Cochrensmae,

If you are considering renting, I would recommend you become familiar with California Landlord and Tenant laws. You can find these online at http://www.dca.ca.gov. If the home that you inherited has minimal upkeep costs you can do well with a rental. It's possible the rental will help you pay part of the mortgage on your new property which would be nice for you.
I love the idea of paying cash for a property if you can do it, but there are tax benefits to financing a loan that you should discuss with your tax professional or CPA.
0 votes Thank Flag Link Mon Jan 21, 2013
There are a lot of things to consider here. First and foremost, it may be best to contact your accountant and ask about taxes and other benefits. Then, where is the house? Have you researched what kind of rent you could get for it? Would you hire a management company to maintain it and to confirm things were handled, if need be, for your renters? If you have the option to pay cash for your new dream house, why wouldn't you. Then you are living a debt free life so far as your mortgage. Or does the rent collected out earn the payments you would make. Lots to consider. Let us know if you would like to set up an appointment to discuss more and or if you would like more information for you. Inventory is low right now so things are selling quickly. We could make that happen for you and welcome the opportunity. Kind regards, Crystal Glenning 562-754-4104
0 votes Thank Flag Link Mon Jan 21, 2013
Hello,
To be honest I would have to dig in deeper in a sense to really compare all of the variables. It would also be a great asset and need to have your CPA involved so that we can put together a make sense plan. I have been involved in the Real Estate and Lending field for many years and this is a very interesting time in which you could leverage the market with the involvement of us all to make your future a make sense plan. Please Let Me know what you think, I would Like to make this a make sense move for you!
Thank You,
Robert Finger
562-577-2888
0 votes Thank Flag Link Sun Jan 20, 2013
I'm a big fan of keeping all the assets you can. Money is cheap right now so financing may also be a great option. Plus the rental income may help you qualify for the perfect home. There are always more personal circumstances that could affect your ultimate decision.

I'd be happy to help you figure it out. Good luck!
0 votes Thank Flag Link Sun Jan 20, 2013
There are too many variables to give you a firm answer without more information. You'd want to consider the price you'd get for selling the existing home, what you'd pay for your new dream home, what your rental income and expenses would be each month, which would be better from a tax perspective, , etc.... It would probably be a good idea to talk to a financial planner and then to Realtors, both in the area where you own a home and in the area where you want to buy. If you want to discuss the variables and options in more details, feel free to give me a call -- 562-896-2456.
Web Reference: http://www.showmehome.com
0 votes Thank Flag Link Sun Jan 20, 2013
Hello,
I'd be happy to discuss this with you. It really depends on several things.
Please feel free to contact me directly, and I'd be happy to assist.

Best,
Susan Bo'ur Realtor/Coldwell Banker
Susan@SusanBour.com
0 votes Thank Flag Link Sun Jan 20, 2013
Talk to your accountant or financial planner in addition to a Realtor. It sounds like you have many options. Renting can turn out well and make you money but you have to be willing to go along with the ups and many possible downs that can go along with renting. It really depends on whether or not you want to invest the time and/or emotional energy into maintaining and managing a rental.

Good luck to you!
0 votes Thank Flag Link Sun Jan 20, 2013
If you're up for being a long distance landlord & paying a property manager 10% of the lease amount per year, then rent out the house. If you have emotional ties to the house, you may not like how a renter may be caring for it.

Or sell, take the cash, buy your dream home With Financing & buy a 2nd home in the same area to rent out & manage it yourself & watch the equity grow in both homes as the market rebounds.

I live right next to the 90808 area & would be happy to talk to you more about how much your home could sell for right now & discuss with you buying with cash vs. leveraging with financing & making it work in your favor.

Shoot me an email directly if you'd like to talk about this further, I don't look back on this same Trulia thread for answers posted after mine.

Emily S. Knell
EmilyKnell1@yahoo.com
562-430-3053 c
Realtor Since 1996
Realty ONE Group
0 votes Thank Flag Link Sun Jan 20, 2013
Honestly, it's hard to answer that without knowing you and your life's plans. Both are good options...it just depends upon your goals for the last 5-10 years. Also, renting a home is not without risk. There are costs involved, there may be times of vacancy, and sometimes you need to do repairs once tenants have been in the place.

Talk to other folks in your community about how easy or hard it is to rent out their property, etc. Consult with a local property management company. Then, make your decision.
0 votes Thank Flag Link Sun Jan 20, 2013
I'd be hapy to talk with you in detail regarding your questions> Richard Gaylord, RE/MAX Real Estate Specialists (562) 618-2113
0 votes Thank Flag Link Sun Jan 20, 2013
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