Rent or Sell?

[2tall79]

My wife and I have decided to move about 60 mi north to be closer to our grandkids (we are both 75). We will be leaving our home of 45 years and renting a house up north. At first I thought we should just sell our house and be done with it ( we pay no mortgage), but now I'm thinking of renting it out and sell it later if need be. Any of you have any experience with this kind of thing, good or bad? We would be using a property management company so that we wouldn't be running back and forth all the time. thanks for any advise here.

 

[Bald1]

In my experience you should be able to get a good manager for 10%. It might be wise to keep it for awhile so you can return there if your plans don’t work out. Also if the election goes a certain way there will be more potential buyers in a year or two which should drive up price.

 

[glenwolde]

If you're never moving back to it, I think I'd sell. Be done with it. But it depends on your market, equity, etc. A rental can work but if you're not getting much income out of it what's the point? The property management fees can eat a lot of the cashflow up. Plus your kids will have to deal with disposing of it one day.

Look at it as an investment. By renting it out you are essentially investing your equity for the cashflow. Plus there's tax considerations, a lot of them.

 

[Narragansett]

I would not sell now, and you are right to use a property manager, but make sure you have it in writing what they are going to do for their 10%, and that you get a check by a certain day every month.

I currently rent after having 6 houses, but still own one ( different state.). However I have a good situation. It is like rolling the dice where rents will go.

Please be really up on your property manager. Remember, they too have cash flow problems, and use your money for something else

 

[s&wchad]

Sell it....

Capital gains for a married couple up to $500K on home you've lived in for over 2 years are tax exempt. Renters can be a nightmare, not to mention the tax ramifications.

Why pay a 10% management fee, when you can invest the proceeds or earn 4.5% interest?

 

[crstrode]

Sell it.
You are old, and time is short. Even with a property manager, a lawyer, and a good accountant, rental property is a huge pain in the neck.

I am married to a crack accountant.
My Dad was a Real Estate Broker.
His Dad was a Real Estate Broker.
I was a Real Estate Broker myself for 45 years.

Owning and managing rental property is not for the inexperienced or faint of heart.

After owning several rentals in my younger days, I have not rented any of my properties for decades. Sell your house and enjoy the money you make.

As a septuagenarian myself, it will be a struggle to blow all the money I have accumulated by selling Real Estate. But I am going to give it a try . . .

:=)

 

[quikdraw67]

Sell it....

Capital gains for a married couple up to $500K on home you've lived in for over 2 years are tax exempt. Renters can be a nightmare, not to mention the tax ramifications.

Why pay a 10% management fee, when you can invest the proceeds or earn 4.5% interest?

This is the way.


All profit and no drama.

 

[lkabug]

Rental properties and very often a big headache.
Management fees, appliances replace cost tax and legal services fees can eat up much of the Rental payments you receive. Sure, you'll get depreciation and, some items at 7 years the structure at 27. Also look at the recapture requirements. Then determine if it is all worth the hassle.
The headache went away when I sold all my rentals. At the age you noted, I would sale and invest the proceeds.

 

[Nightowl]

Sell it!! I rented out my house for 15 years, after I had lived there for 15 years. I finally had to rehab it, an effort that took me several months, as my lady and I would spend several hours a day fixing walls, paint, woodwork, new windows, siding, etc! After all that, I decided never to do that again and sold it. My knees were sore for months! On top of all that, I paid a ton in capital gains taxes!! Just my .02 worth!

 

[Greyman50]

I also say sell. The tax free situation is hard to beat. Remember leaving kids/ grandkids Cash is way easier than a house. Enjoy the proceeds from the sale, travel or whatever you all want to do.

 

[Ameshawki]

Sell and never look back. I've had a number of friends try their hand at the rental business. All but one got out of it. Picking tenants is an art form. Most don't have it.

I'm not sure a move of sixty miles is worth the effort. Make sure you have realistic expectations on just how much you'll be seeing your grandkids. They will get busy with all sorts of things sooner than you think.

 

[Golddollar]

When I was a boy we rented out the house we wanted to sell while we lived in a rental house near my dad's new job. If you can't get a good property manager, then sell the house, take the money and run. Over sixty years later I can still remember going on long trips with my dad to chase down and collect rent from deadbeat tenants.

 

[arjay]

Sell it. We’re too old for all of the nonsense rentals can entail

 

[smoothshooter]

You and your wife’s health must be factored in, along with what a sale of the house will net you after taxes. Good neighborhood or bad?
Hire a reputable Financial planner. Money well spent if you don’t already have one. Talk to your Tax Guy.
Depending on how the Elections shake out, I would sit tight for at least 4 or 5 months to get a better idea of what we have in store. Things will swing dramatically one way or the other.
The more I think about your dilemma, barring any family or political red flags, selling out and moving might be your best option after all.
When one gets to your age ( I am not too far behind you ) it is good to reduce complicated financial entanglements for several reasons.

 

[sophie]

If you don’t plan on ever returning to your house you have lived in for 45 years, then like many have said above, I would sell the house. Why have the worry of a property manager and renters?
Just my two cents.

 

[Erich]

Obviously, the decision comes down to the benefit you anticipate deriving versus the costs you think you might incur.

What happens if there's another pandemic and the government won't let you evict a renter who takes that as an opportunity to quit paying? And - yet - doesn't pay the utilities . . . but the courts make you pay them to keep the house habitable for the renter? And then the house requires major repairs?

This happened to my in-laws (now 91 and 92) . . . and they weren't even paying a property manager a thing because their son the Realtor was taking care of everything. Including going to court for them, repeatedly. They wound up selling the house as soon as they were able to evict the bum resident - which took an unreasonable amount of time (more than three years - during which entire time they were on the hook for the utilities the bum renter was using), thanks to the rules the NM Courts had put in place. My in-laws never got back the utility money or the back rent.

When we were young, my wife and I rented out a house that we owned (using a property manager) for several years - at the end of the rental period, the house had incurred major damage despite the property manager's efforts. This did NOT happen during COVID, but wound up being just a giant financial drain and hassle. We're both lawyers, but you can't get blood from a rock; we took the loss. And we sold that house below market value just so we could concentrate on our real jobs without distraction.

Now, what if the renter's grandson ("He's not really living here; I let him stay sometimes because he's a good boy") sets up a meth lab? I've seen it happen. Know what remediation for that costs?

Anyhow, my experience and our cost/benefit analysis has been being a landlord is a hassle and a gamble, and that since we're not willing to spend a lot of energy on ownership, it's not worth it. Now that we are older, there's no way we'd rent to anyone.

It sounds as if a lot of people here have the same opinion. I don't know what you should do, but I sure hope you think it through and don't wind up with an ongoing hassle and expense.

 

[smoothshooter]

Sell and never look back. I've had a number of friends try their hand at the rental business. All but one got out of it. Picking tenants is an art form. Most don't have it.

I'm not sure a move of sixty miles is worth the effort. Make sure you have realistic expectations on just how much you'll be seeing your grandkids. They will get busy with all sorts of things sooner than you think.

Very true about the grandkids. Nowadays there is a lot of peer and parental pressure to get involved in after-school sports.
My son works 6 days a week, has 3 kids in school, and they spend so much time going to some event or another (sometimes two or three simultaneously ) that most nights it is late when they get home, so Mom throws something together for supper. Then they eat and crash. They live about 2 hours from us and we rarely see them.
When we are together we get along great. Mom and the kids are good people.
I could not live with doing that many school events almost every day all month year after year.
When my son was in school, it was a very small one, and all they had was a basketball and baseball team. Very little or no track and field. So we still had some family time most nights.
He turned out to be a fine young man.
As they graduate HS over the next 3 or 4 years and get away from the sports the Spousal Unit and I expect to see them more.

 

[Exaviator]

"A bird in the hand is worth two in the bush" If you are sure that you will never return, and confident that your grand kids are also settled in their location - they do have a habit of moving on - then I would agree that at 75 the best option would be to sell. As an octogenarian myself, I can assure you that you do not need any unnecessary and avoidable hassles in your lives going forward.

 

[Kanewpadle]

Sell now. Not only for the reasons mentioned but also for a few other reasons.

I live a few miles south of you. Kent is infested with crime not to mention homeless squatters. It’s not going to get any better because of the voting habits here.

And the market is at an all time high.

I was a locksmith in Kent for 25 years. I’ve seen the change. We did quite a bit of work for property management companies. There aren’t many decent one’s choose from. And I’ve seen the heartache that home owners go through when a renter or squatter completely trashes their home.

It only takes one to cost a home owner tens of thousands.

 

[Onomea]

As we get older, the fewer things to worry about, the better.

I, too, think best to sell the house.