Hoping to get some advice from the market-savvy posters on piggingtons…since our real estate agent is not being very helpful. We recently inherited a house in Antioch, which is in the far-east Bay Area. The house, built in 1947, is a POS. It has been a rental for at least 2 decades, and needs not only updating but some repairs (my guess is $20K or so). It appraised at $385K a year ago, so we put it on the market a month ago for $279K. It is BY FAR the lowest asking price psf in the area. There has been lots of traffic but no offers. We are willing to deal, but would like to see an offer–even a lowball–before we just arbitrarily lower the price so we know what we are dealing with as a range. We are going to get hit with a hefty property tax bill soon and are wondering whether we should just hold on to the place a for few years and rent it out until the market is not as crazy. We could rent it for $1100-$1300 a month but would incur costs for the repairs. Am I being too impatient with the sale process? The realtor said that sales are taking 3-6 months, but all the doom-and-gloom I read daily makes me think it won’t sell at all. Should we just rent it out and forestall the “windfall” we thought we were going to get?
An important consideration is – how much tax will you pay when you sell it? If that is a tax-free sale, it sways the decision towards selling. If you have to pay %25 capital gain tax on the whole thing, that sways it towards keeping it.
$1100/month forever is a pretty friggin’ good windfall.
I think I would consider taking out a small HELOC on the property to fix it up and pay the property tax, then send all of the rent to pay off the HELOC, and write-off the interest. You’d have it paid off in two or three years, then would be getting $1100/mo in (pre-tax) income.
An important consideration is – how much tax will you pay when you sell it? If that is a tax-free sale, it sways the decision towards selling. If you have to pay %25 capital gain tax on the whole thing, that sways it towards keeping it.
$1100/month forever is a pretty friggin’ good windfall.
I think I would consider taking out a small HELOC on the property to fix it up and pay the property tax, then send all of the rent to pay off the HELOC, and write-off the interest. You’d have it paid off in two or three years, then would be getting $1100/mo in (pre-tax) income.
An important consideration is – how much tax will you pay when you sell it? If that is a tax-free sale, it sways the decision towards selling. If you have to pay %25 capital gain tax on the whole thing, that sways it towards keeping it.
$1100/month forever is a pretty friggin’ good windfall.
I think I would consider taking out a small HELOC on the property to fix it up and pay the property tax, then send all of the rent to pay off the HELOC, and write-off the interest. You’d have it paid off in two or three years, then would be getting $1100/mo in (pre-tax) income.
No capital gains tax to pay when we sell, because the adjusted basis will be the value as of the date of death (which is the $385k). Essentially we will be taking capital gains loss deductions forever at $3000 per year.
No capital gains tax to pay when we sell, because the adjusted basis will be the value as of the date of death (which is the $385k). Essentially we will be taking capital gains loss deductions forever at $3000 per year.
No capital gains tax to pay when we sell, because the adjusted basis will be the value as of the date of death (which is the $385k). Essentially we will be taking capital gains loss deductions forever at $3000 per year.
I would stop being greedy (not that you are), slash the price by $40k, it should sell then. After that, relax, treat yourself, and be stress free. Don’t look back!
I would stop being greedy (not that you are), slash the price by $40k, it should sell then. After that, relax, treat yourself, and be stress free. Don’t look back!
