Should I sell my house or rent it out?

Asked by CentralMAResident, Whitinsville, MA Tue Feb 26, 2013

I am looking to make a move after living in the house for 8 years. I owe more than the house is worth (Its a single family colonial in a neighbourhood).

I am wondering if I should rent the house rather than selling for a huge loss (100K). Looking for some thoughtful and knowledgeable insights.

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7
Gail Carter, Agent, Whitinsville, MA
Wed Feb 27, 2013
Good evening,

This is a hard question to answer with a definitive yes or no. It really depends on your individual situation. Being a landlord is not for everyone, so that would be the first consideration. You could possibly short sell the home and if you are current with your payments, have a minimal hit to your credit. I would love to sit down and go over all the scenarios with you, if you'd like to see if it would help you make a decision.

You can email me at GailCarter@ERAKey.com or call me at 774-280-2217


Good luck!

Gail Carter
0 votes
Louis Wolfs…, Agent, Needham, MA
Tue Feb 26, 2013
Ron -What if interest rates become realistic, 5,6,7% what will happen to his value????

Rent? Watch Pacific Heights Income come property can be good, but understand the pitfalls of being a landlord. Also income property should provide a rent that will cover your debt. Always a good idea to have someone else pay your mortgage, but understand that the value of your asset may go down or it may go up.

Obviously you do not need to sell to buy or you would not qualify for another mortgage. For those that suggest a short sale, it would make it very difficult for you to obtain another mortgage.

If you sell your home for a loss, assuming you are looking in a similar area your buying power should be more, which will help offset your loss, and create greater value should the market improve drastically. Although inside RT 495 there is limited good inventory on the market presently.

Why do you want to move? Larger home? Smaller home? Newer home? Better Location? Different state? Remember your new home may go down in value as well.
0 votes
Ron Thomas, Agent, Fresno, CA
Tue Feb 26, 2013
For problems like this, I highly recommend a Ben Franklin Balance Sheet:
Yes, Ben invented it!

Take a tablet and make two columns: Label one SELL or PRO, and the other RENT or CON.
Enter every reason you can think of for each comumn. No matter how important to you. If you want, "weight" each entry. Usually the sheer number of entries will make the decision evident.

If you want my opinion; hold on to it for two important reasons, Wealth is accumulating assets, not selling them at a loss, and, with an increasing Market, you should be able to see some equity soon.

Good luck and may God bless
0 votes
Christine Mo…, Agent, Wilbraham, MA
Tue Feb 26, 2013
Try renting it. You can always sell if renting isn't your thing. While it may take some time for the value to come back up, if you get good tenants it can become a good situation for you.
0 votes
Kelly Nelson, Agent, West Boylston, MA
Tue Feb 26, 2013
Good Afternoon,

This would all depend on your personal situation. Banks need to have some "hardship" reason to forgive the difference when allowing fo a short-sale. If you would like to disuss this further I would be happy to assist you. I also do rentals and property management in your area.

Good Luck!

Kelly Nelson
508-579-6564
0 votes
Wade Roach, Agent, Lakeville, MA
Tue Feb 26, 2013
Your basic choices are to do a short sale, write a check for the shortage, or rent it. If you do a short sale, you can preserve your credit and do one without being late on payments. You just have to find an agent in your area who knows how to do that. The best negotiators in the region are Short Sale Mitigation, http://shortsalemitigation.myproptrackr.com/. If you can afford to write a check for the shortage, I would advise renting it out before loosing that kind of money. If you can afford to move without one of the first two options, renting it is the best option. It will regain it's value in time and allowing tenants to pay the mortgage is a good option. If you are not familiar with the rental process, you should hire a local agent who deals with rentals. They can guide you or take care of it for you. If you are not familiar with being a landlord, the best thing you can do it to hire a property manager. Good luck.
0 votes
Richard Shap…, , Framingham, MA
Tue Feb 26, 2013
Renting can take a lot of work. Sale would require a short sale process. I would think cutting all ties by selling might be best.
0 votes
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