Author Topic: Should I sell or rent?  (Read 1706 times)

davef

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Should I sell or rent?
« on: July 17, 2014, 01:28:00 PM »


Here is the situation. I have a house I used to live in that I moved out of in 2010. I rented it fully furnished with utilities for 1850 a month to a friend for 2 years and to my father for the last 18 months. The property is in indiana, I live in Oregon. My father is moving out in September. Do I look for a renter on the market? or Sell it?

Market Value: 195,000 (According to zillow its going down)
Original Purchase price: 169.000 (2009)
Original Mortgage Amount: 135,000
Interest Rate: 4.75 Fixed
Mortgage Term: 30 years
Term remaining: 25 years
Amount remaining on mortgage: 68,000 (I put a lot of extra $$ toward it)
Gross Rents: 1850 per month (minus the $250 or so a month for utilites)
Principal and Interest (the P&I of your PITI - should match with the above info): 719
Taxes and Insurance (the T&I of your PITI): 259
HOA costs: 0
Deferred maintenance notes: 0
The school system is bad 2/10 in that town, but other than that its a nice area.

waltworks

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Re: Should I sell or rent?
« Reply #1 on: July 17, 2014, 01:59:17 PM »
Probably a wash. If you think you can get a non-relative/friend to rent for that amount (how are utilities $250/mo, btw?) and you're ok being an offsite landlord, it's a 1%-ish rule property and since you'd have to pay transaction costs to sell it, it might just be worth keeping.

I'd probably keep it but if you have something else you want to use the money for, that could tip the balance the other way.

-W

davef

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Re: Should I sell or rent?
« Reply #2 on: July 17, 2014, 03:44:23 PM »
Electric is very cheap in Indiana where its still mostly coal generated, as is water with the great lakes nearby. Gas is aslo cheap, and i bought all newer natural gas appliances. Good insulation on a 2400sf house. the average gas/electric bill combined for the first 3 years was $130per month. My father leaves the AC on a alot and they had a very cold winter, the averge YTD is $165. Sewer /water /trash is about $70 per month.

waltworks

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Re: Should I sell or rent?
« Reply #3 on: July 17, 2014, 04:48:06 PM »
I wasn't clear - those utilities seem crazy *high* to me. But it sounds like you've done all you can to control those costs. I will say that I prefer to have renters pay utilities - it gives them an incentive not to be wasteful, even if it's a wash for the landlord financially.

-W

Electric is very cheap in Indiana where its still mostly coal generated, as is water with the great lakes nearby. Gas is aslo cheap, and i bought all newer natural gas appliances. Good insulation on a 2400sf house. the average gas/electric bill combined for the first 3 years was $130per month. My father leaves the AC on a alot and they had a very cold winter, the averge YTD is $165. Sewer /water /trash is about $70 per month.

davef

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Re: Should I sell or rent?
« Reply #4 on: July 17, 2014, 04:59:49 PM »
I would too, but since it was my father& friend I went along with it.
I'm not sure what I could get for the place on the market. I talked to a property managmenet company and they thought about where I am at (without utilities). I doubt that.

solon

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Re: Should I sell or rent?
« Reply #5 on: July 17, 2014, 05:06:25 PM »
My experience is landlording causes headaches! You've had good experiences in the past because of your good renters, but what happens when you get a bad renter, and you're 10 states away?

I think you should get out now, while you can still make a little money on the place, and then do something else with the gains.

davef

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Re: Should I sell or rent?
« Reply #6 on: July 18, 2014, 07:46:15 AM »
That is kind of the direction I'm leaning. The area is declining. I could always take the money and by a rental here in Portland while rates are still good. That way I could watch over it.
I have the skills to do all of the reno work myself, (and the weekends off) So I just may do that.