Author Topic: Advice: Sell my House Invest 100K?  (Read 3518 times)

JJ saves

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Advice: Sell my House Invest 100K?
« on: November 20, 2015, 08:53:09 AM »
Not exactly sure if this should be in the "Real Estate" or "Investing" forum but here is my question.

Should I sell my home and invest 100k plus into my vanguard account? The thought of being able to add that much cash to help me retire sooner is very tempting. Also scary, because I have become attached to my home that I love. I probably would not buy again because the SoCal market is expensive.
Im 31 single no kids, and if I did do this Id possibly have 200k in Vanguard Investments.

 
mortgage  30yr fixed @ 4%
purchased- 195,000$
owe-          160,000$

worth 280,000$.

similar house sold on my block for this price with same Sq footage and no pool. Mine has a pool.I love my home and neighborhood. Ive got cool neighbors and it close to work. However this would give me a large boost in investment income and I could down size for a few years renting a room near the beach while saving.


DaveR

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Re: Advice: Sell my House Invest 100K?
« Reply #1 on: November 20, 2015, 09:47:54 AM »
Since it sounds like you're open to roommates, also consider down sizing to one room in your house and renting out the other room(s). That would boost the savings too...

Dicey

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Re: Advice: Sell my House Invest 100K?
« Reply #2 on: November 20, 2015, 12:34:41 PM »
Hell, no! If you can cash flow the house with renters, find cheap digs and collect the rent. Or take DaveR's good advice.

It's hard to get into SoCal real estate and getting out of it comes with huge fees. Just for fun, calculate the fees you'll pay for closing, commissions and moving expenses. Then look at that number as a percentage of what you'd get from selling the house. I suspect that the take-away would be worse that taking an early distribution, complete with taxes and 10% penalty, from a retirement account. You'd never do that, would you?

There better ways to make this asset work for you than selling it.

Tester

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Re: Advice: Sell my House Invest 100K?
« Reply #3 on: November 20, 2015, 01:09:47 PM »
because I have become attached to my home that I love. Iprobably would not buy again because the SoCal market is expensive.
I love my home and neighborhood. Ive got cool neighbors and it close to work.

For me that is your answer.

JJ saves

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Re: Advice: Sell my House Invest 100K?
« Reply #4 on: November 20, 2015, 01:28:46 PM »
Hell, no! If you can cash flow the house with renters, find cheap digs and collect the rent. Or take DaveR's good advice.

It's hard to get into SoCal real estate and getting out of it comes with huge fees. Just for fun, calculate the fees you'll pay for closing, commissions and moving expenses. Then look at that number as a percentage of what you'd get from selling the house. I suspect that the take-away would be worse that taking an early distribution, complete with taxes and 10% penalty, from a retirement account. You'd never do that, would you?

There better ways to make this asset work for you than selling it.
Wow your right! I was playing with "Cost to sell Calculator" and Id probably walk away with an Estimated 74k and Id lose 46k in taxes/fees/closing. I know those numbers aren't exact but thats a big hit.

The rental market is strong in my area. One of my neighbors has been renting for the past 6 years an identical house for 1650$. My mortgage, taxes insurance equal 1250$ combined so id make profit renting. Also the room rental is an option I would explore again. Had one roommate when I first bought it, but the guy turned out to be junk.

JJ saves

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Re: Advice: Sell my House Invest 100K?
« Reply #5 on: November 20, 2015, 01:34:13 PM »
because I have become attached to my home that I love. Iprobably would not buy again because the SoCal market is expensive.
I love my home and neighborhood. Ive got cool neighbors and it close to work.

For me that is your answer.

You make a good point.

Matumba

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Re: Advice: Sell my House Invest 100K?
« Reply #6 on: November 20, 2015, 01:37:21 PM »
I wouldn't sell it.

-If the housing market crashes, the stock market will likely crash even more.
-You house is a leveraged investment. If you sell it and invest the difference in stocks, it won't be leveraged.
-Your house can generate income from rent (or imputed rent if you live there).
-You are attached to your house.

JLee

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Re: Advice: Sell my House Invest 100K?
« Reply #7 on: November 20, 2015, 01:41:53 PM »
What are room rentals going for in your area?  My house in Phoenix was costing me ~$850/mo + util I and I was pulling $1100/mo by renting the two spare bedrooms. You could probably live practically for free if you wanted.

JJ saves

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Re: Advice: Sell my House Invest 100K?
« Reply #8 on: November 20, 2015, 01:58:49 PM »
@Jlee are you still renting out the rooms? How did it work out?

Room rentals average 550-650$ in my area. Its 3 bedroom 2 bath with a possible 4th bedroom if I converted my office. I also thought of building a Casita and rent that out. Ive gone over all kinds of "what ifs".. ha!

JLee

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Re: Advice: Sell my House Invest 100K?
« Reply #9 on: November 20, 2015, 02:12:37 PM »
@Jlee are you still renting out the rooms? How did it work out?

Room rentals average 550-650$ in my area. Its 3 bedroom 2 bath with a possible 4th bedroom if I converted my office. I also thought of building a Casita and rent that out. Ive gone over all kinds of "what ifs".. ha!

The couple that was renting the larger room moved out over the summer. The other guy is still there and he's fine - I have since moved out of state and will rent my master suite out to a good friend, so I expect that to continue working well.

The first roommate I had was pretty shitty, but could have been worse. Fortunately I only signed him on as a short term rental with a set end date / no renewal in the first place.

Bearded Man

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Re: Advice: Sell my House Invest 100K?
« Reply #10 on: November 20, 2015, 02:19:51 PM »
I could live for free in my houses if I rented out the rooms. My last house is perfectly suited for it. 3 bed, 3 bath, k arge rambler with two beds and a bath at other end of house, with a bathroom. Two water heaters, two fireplaces, two kiving rooms, huge kitchen, and seperate area for master bed/bath.