Asked by Nervous_pa_home_owner, Palo Alto, CA • Mon Mar 8, 2010
I have a house currently rented rented out for around $4700/month in Bay Area. The house is probably worth $1.3M to $1.6M, it's a big range because it is hard to say how uch we can get in this market. It was our main residence and has been rented for 1 year now.
The tenants will move out soon, so the question is what do we do with this house?
Here are the pros and cons:
1. tax benefit on gains ($0 to $200K depending on sale price)
2. no more headache on tenants
3. rent barely covering the expense, so no ore negative cash flow
4. cost associated with selling, upgrading, loss of rent income, staging etc. The cost could go pretty high to above $30k.
5. risk of unable to sell at the desired price.
1. More gains potentially in the future
2. still easy to rent, and rent ay go higher than $4700, so no immediate impact on cash flow.
3. more headache on renting related problems.
4. risk of real estate market down turn and lose the tax benefit
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