Through this entire house building
process, we've had many decisions
to make. One has been to decide if
we will sell our current house, which
is owned by us, free & clear, or to
consider renting it out. If we did go
this route, we'd have to of course,
put a mortgage on it as we would
have used this house's equity to pay
for the new house. Our new home
would then have a bit of a mortgage
on it but one that we'd pay off pretty
quickly. This house's value is under
the new one & the equity we have
is great but even with our savings,
there is still a bit of a shortfall. We
are both comfortable with this &
all along we knew we'd likely sell
this house so we'd remain living the
comfortable life that we'd are loving.
Things have changed a bit. Our rich
economy in this province is shifting
as the price of oil has dropped too
a very low dollar & this is a worry
for many. Jobs have been cut & soon
we'll start to feel the effects in the
real estate market. Both my dh & I
work in industries that never seem
to get hit with the recession & we
know this is just part of the "boom,
bust, recover" that happens in oil
rich communities. However, this
time, our timing with selling our
current home may be effected by
the industry & we need to make
some concrete plans around what
we will do if the real estate market
takes a big hit in the next couple of
months. One of our options is to
hang on to this house & rent it out
until the market corrects itself again.
So here's my big question of the day?
Do we rent out our house & wait for?
Or sell now & take the best price we
can get, even if it's a bit lower than
we had hoped for? I'm only talking a
difference of anywhere from $1,000
to $20,000 as a guess. We know in our
community, it's hard to find a great
place to rent & we know we have a
wonderful house in a truly perfect
location. Rents are high here, more
than enough to cover the mortgage
payment, taxes & expenses. I've
never been a landlord & my fear is
that we'd rent to someone who might
trash it in the end. We'd have to do
a lot of background checking & take
a risk but it could work. There are
tax benefits to this scenario too.
Either way, worry is involved.
What would you do if you were in this position?
Do we go the safe route & get less money in hand?
Or take the riskier route & fingers crossed in the
end come out on top with a bigger profit?
2 comments:
We put our home in Sherwood Park twice, the first time taking it off after 3 months and had my stepson live in it for a year. The second time we went to sell it it sold in 2 weeks. Renting a nice home is always so tough - difficult to find the right kind of renters. We ended up taking $20,000 less than we hoped but we did sell the home previous to that for 2.5 times as much as we bought it for (another boom time). It is a tough choice. I do believe Alberta's economy won't be down for long though. Oil is already starting to sneak back up.
Ouch! I hope we don't have to list twice. We have someone interested even though it's not ready and we'll be bringing them through in the next few weeks. If they say no, then we'll list for a period of time and if it doesn't sell, then we'll rent it out. A realtor told me that we're still in a good position for selling as gas has gone up again, so the predicted recession may not be a bad one. Fingers crossed!
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