Real Estate Questions

[sweetana3]

From your post and several misconceptions it indicates, you really need to consult a tax and legal professional before making any other drastic and irreversable steps based on incorrect info.

[Zippy]

It doesn't seem to me it will be a good investment to keep your one-bedroom unit if the monthly fees are that high and the rent you could collect would be $800. Those fees will rise over the years, you will have vacancies, and your housing & rental property are not diversified - too much of your net worth will be tied up in one location unnecessarily. So, my advice would be to sell your one-bedroom if you decide you absolutely want the two-bedroom.

You have no mortgage, right? Do you really, really, want to have a mortgage again? Or even maybe two?

[dovergirl]

Definitely consult a professional. I would not want to carry the 1 bedroom condo indefinitely. If your parents want to rent it, ok, but I would not keep it just in case they do. Would your parents eventually buy it?

[bigbear]

I saw the two bedroom condo on Thursday. It was not in as good shape as I had thought based on the photographs though there is no furniture, so that was part of the issue. It does have beautiful trees now in bloom covering nearly one whole side. The terrace accessed from windows at the moment runs almost the entire other length, so it could be like living in a tree house.

One of my elderly neighbors put a note under my current condo's door asking me to call her. I had been out of town for two and a half weeks and she had forgotten why she asked me to call her which might be a bad sign but anyway we had a nice chat and I mentioned that I was going to be seeing the new condo that day. A few years ago she had said if I ever decided to rent out my place to let her know. She is one of the few renters in my building and now pays $1300/month for a two bedroom two bathroom. If she moved into my place, she'd save money. Additionally, the place she is renting is for sale. On Friday, she left me a message saying she was getting more frustrated with the owner of her condo as for the second time she cleaned the apartment for a showing only to have it cancel at the last minute. I'm encouraged she might want to rent my place as it would keep me from having to put it on the market right now.

So, I'm still unsure of how/if to proceed. The realtor will be out of town all next week. After that, my parents and some other friends are going to look at the big condo with me so that I can get their input too.

[Zoebird]

well, if you aren't happy with the condition, definitely offer even less money in some form of offset what nots.

[jp1]

Personally I would definitely not become a landlord in that situation. Your income would only be about $3000/year. A paltry 3% based on a $100,000 value. Not to mention the association assessment that would gobble up over a year's worth of your profit. You could make that much profit with far less risk, uncertainty, and work by putting that money elsewhere.

If you want the 2 bedroom I'd sell your current place and buy the new one and find other investments for your excess income.

[bigbear]

Fingers and toes crossed, but it appears I am buying the two bedroom condo. Signed a contract a few weeks ago and am supposed to close a week from today.

I truly feel this was meant to be as I got a great price ($123,500) in what was basically an estate sale. My 93 year old neighbor died two years ago and some basic renovations were done to the condo with the neighbor's grand niece moving in briefly. The apartment has been empty and for sale for nine months. 2 bedrooms, 1 bathroom, 1279 square feet, six closets and a potential small terrance off the dining room and the bedroom. I am so, so excited.

This financing thing is about to kill me but I'm hoping to cross the last hurdle for that today.

So, now I need to sell my little condo next door that is 879 square feet, 1 bedroom and 1 bathroom. My elderly renting neighbor already in the building looked at my condo recently to consider renting but after a few weeks of serious thought decided against it. I understand, she is in her 70s and can afford to stay in the bigger place she is in. However, she is now moving furniture around my place virtually, so she may be reconsidering. She is also thinking of buying my place. The big condo she is renting is for sale and the owner is a bit difficult to get along with. His place is overpriced now but if by some miracle it sells she would have to leave anyway.

So, I am finally about to come up for air in getting my place ready for photos, doing regular work, handling the financing nightmare, etc.

Now, I'm wondering if I should get a realtor. I didn't use a realtor for the big place since the seller was good friends with her realtor and he has been really great with me. I've done okay on my own but I'm not really driving this process and wonder if I would be as the seller. Could I get it done just by hiring a lawyer for the details and posting to Craigslist myself? How could I list my place on the multi listing service without a realtor?

I've never sold a place before but honestly in my heart I'd rather just get rid of the little condo than rent it. Last August, I paid it off, so selling it might allow me to either almost pay off the new place or get a big savings account. I've recently joined the condo board, so I might be able to rent but I'd have to have their permission. Should I list it to buy or sell?

Anyway, I just wanted to let you know the "rest of the story" and request thoughts, wisdom and lessons learned from selling or renting real estate.

Thanks.

[JaneV2.0]

Congratulations! This sounds like a move from the heart--always a good thing where real estate is concerned.

I bought my first place without realtor involvement, and the deal went very smoothly; it can certainly be done. You will probably want to engage a real estate attorney (I didn't) and you will need a title company. You could advertise it yourself--there are for sale by owner websites--and see how it goes. If you feel uncomfortable with the process or it doesn't sell, you can always move on to a Realtor.

[bigbear]

I bought the two bedroom condo. Moved in this month and am almost settled. So, now I'm turning attention to what to do with my little condo next door.

The little condo has one bedroom and one bathroom. It is 879 square feet. It had been painted fairly recently before I moved into it in 2003. It has lovely curtains in the living and dining rooms. The kitchen is in fairly bad shape with avocado green countertops, sink and kind of plywood like cabinets. Hardwood floors and tile bath. It is in one of the best neighborhoods in my southern city. The building was constructed as very high end apartments in the 1940s and went condo in the 70s.

So, I'm looking for feedback on whether to try and rent/sell and/or how much to ask when trying to sell or rent.

I have a contract job that technically ends in December but which I think will be renewed. I gross $120K/year and up until I bought the new condo had no debt. With the new condo and the little apartment, I'll now have mortgage/condo fee/property tax expenses monthly of $2,250 or so. The little condo has a fee which cover most utilities and insurances of $426.45/month along with about $900/year in property taxes. I got the money to buy my new place by getting a 15 year fixed rate 4.25% interest mortgage for $99,800 along with a $30,000 401k loan at 5.25% fixed rate interest. So the mortgage on the new place is $750, condo fee is $588 and property taxes are about $1900/year. The payment on my 401K loan is less than $200/month I believe. So, if I could get rid of the little condo, I would avoid the $426.45/month and the $900/year property taxes plus I could pay off the 401K loan which would save a bit under $200/month. This would reduce my mortgage/condo fee/property taxes to $1,500/month.

Okay, so I bought the little condo for $84,500 in November 2003 and I paid off the mortgage last August. The realtors who came to visit thought I should list it at $99K (which I think is low) and give them a 5% commission. I would also have to pay title insurance if I sold the place of about $700. This would leave me with $92K in cash if that worked out. Whatever I get from the little condo I'll use to pay off the 401K loan and probably put the rest in savings until I see if my job is renewed. After that, I'll probably combine it with overall savings to pay off the big condo. I'd like to list the little place for $115,000 and take $110,000 or maybe $105,000 with no realtor. If I could get $110,000 in cash, I'd take it today.

I got an awesome deal at $123,500 for my new condo which is 2 bedrooms, 1 bathroom, 1279 square feet and honestly much nicer. I know there is a big difference between the two condos so perhaps $110,000 is optimistic. Who knows?

There is also the potential to rent the little condo. I think I could get $750/month or thereabouts. I'd have to get approval from the condo board with no penalty but I think I could since I am on the condo board and my boyfriend is another of the five members. I would prefer to sell the little condo to get it over with and to be able to move towards being debt free, but it is not a fire sale and I don't have to give it away. My main goal at this point is to have it not sit empty costing me over $500/month.

So, what I think I have decided is to try and sell with the best price I can get unless:

A) The tax benefits of being a landlord are so overwhelmingly wonderful that I can save a significant amount. I'm single with no dependents and, up until now, no debt, so I'd like to pay less in taxes

OR

B) I just have to give the condo away for nothing. I can afford to carry it for a while.

It looks like for the new mortgage (15 year, 4.25% with borrowed amount of $99,800), I'd pay about $400/month in principal and $350/month in interest. Plus I have that other 30K 401K loan which is all interest I believe. I'm also concerned that I'd get a bad renter, the renter wouldn't pay, what are eviction laws, etc.

From your experience, what would you do in my position? Try to rent and sell at the same time and take the first offered? Just try and sell and accept whatever I'm offered and say good riddance? Try to rent and use tax advantages? Thanks.

[rodeosweetheart]

Personally, I would sell, but I am not cut out to b e a landlord! the new place sounds fantastic; congratulations!