My wife and I purchased our home in 2006 just before the real estate collapse. When purchased, we had $40,000 equity and began remodeling. Now we have about $15,000 of our own cash tied up in the house (due to storm insurance company put a new roof on it).
As far as the community, it was great then. We had wonderful schools, didn't have much crime. Now, it makes me sick to think about how in just a few short years we've changed. The school system has gotten worse, we've pulled our kids and now sending them to private. I don't like to tell people where I'm from now.
I know I want out, but sadly the economy has prevented us from selling our house. We've tried, but with comparable houses selling for 50% of what I need to get out it's not looking good. We both work locally (within 15 miles) and don't want to move too far from work. There are a few other areas locally we'd like to move to however we can't just leave our house.
Now we're not sure what we should do. I've considered just leaving the house and letting the bank have it but I can't do that in good conscious. I've considered renting, but really need any cash to buy a new house. I don't ever see our community returning to the flourishing place it was years ago. I want to just sell our house; and be gone. Just cut our losses and start over. We're in our 30s and I had hoped to not start over now, but we're young enough we can.
Any advice is appreciated.
Mon Sep 17, 2012 2:48 pm
Cash: $ 381.25
Joined: 09 Feb 2009
Wow in 4 years the community and school districts went down the tubes, where do you live? You don't have to answer that. IMO you have 3 options:
1. Rent your home out and buy something affordable in a better neigborhood, but be ready to cover the mortgage if you cannot find a renter.
2. Sell the home for a loss and pay off the difference. Rent for a awhile to save up a 20% dp on a new home.
3. Stay and pay down your mortgage and wait for the recovery. That's what I'm doing because eventually it will be free equity.
Risk comes from not knowing what you're doing. (Warren Buffet)
Mon Sep 17, 2012 3:44 pm
tlpitch New Member
Cash: $ 0.90
Joined: 17 Sep 2012
I will keep an agnostic approach to politics here- but you're right. A big difference in just 4 years. My wife and I both graduated high school in our county and it was ranked one of the top schools in the state. Now its ranked one of the worst schools.
I don't expect home values to rise back to what they once were. We've seen neighbors come and go. Each one bringing their own problems. The neighborhood has historically been original owners but as they retire and move away they are enabling people to purchase houses that they couldn't normally afford. The average home price (pre-bust) is about $150-$180k. I've seen houses sell for $50-60k. So you can imagine how I feel about purchasing my house for mid-$100s expecting the same from my neighbors. Now we're getting people that can afford $50. One house has multiple cars that don't run that occupy space in the culdesac (they're parked like you would park in a parking lot, not parallel parked!). I'll stop venting.
We've pursued purchasing another house and renting ours. Our mortgage (including tax/ins) is about $850. A good friend of mine, who works at the county's assessor's office, told me I could easily fetch $1000-1100/m which would put $150-$250 in my pocket each month. Which would be used to cover months where I don't have a renter (and repairs between renters). I'm in favor of renting the house just to get out of the town; but my wife has some hesitations.
I'm not a fan of renting another place as it's cheaper to buy (unless you move a lot). I see 2 options, buy another house and rent this one until such time we can/want to sell it - or put bars on the windows and bunker down. Either way, I don't expect home prices to rise much beyond what they are now in our community.
Mon Sep 17, 2012 5:04 pm
coaster Senior Advisor
Cash: $ 1626.30
Joined: 11 Oct 2005
Re: Recommendations for our house
quote:Originally posted by tlpitch ...I don't ever see our community returning to the flourishing place it was years ago. I want to just sell our house; and be gone. Just cut our losses and start over.
It's typically sentiments like these you expressed that are sure signs of the bottom.
I think the rent and buy would be a viable option.
But I think there may be another option you should think about: become an activist in your community and restore it to your image of what you want it to be. Clean it up, run out the trash, and it can come back. Study the "broken windows syndrome"
Ha- activist. I am already. Up until earlier this year I worked for the county's commissioner. I was fortunate enough to have worked under the previous one who did a wonderful job. For years I kept my opinions low-key and help others seek office. I'm working very closely with the person who, with any luck, will unseat the incumbent. Hopes are low, which is why I'm motivated. When the current guy got voted in we listed our house for sale the next day. It didn't work so well. I'm quite political, but since this isn't "Political Talks" I'm trying to stay away from political talks.
Financially, I'm concerned about buying another house and getting the renting job started. I know with due-diligence on potential renters I can make this smooth for us, but the thought of floating 2 mortgages scares me since we're already stretched pretty thin. Like I mentioned I just put the kids in private school (this is the second month now) and I'm not pulling them out. That in of itself is another mortgage payment.
There are not many life style adjustments we can make. Our mortgage is the only debt we have, and we don't live lavishly. We dine out just a few times a week (mostly for lunch, but as a family at most once a week). We don't have expensive hobbies or toys. The only change we could make is to sell our camper which could fetch $10-12,000.
I will talk to the wife, we have plenty of time since are not being forced into making a decision quickly.
Mon Sep 17, 2012 5:42 pm
cameronwhite New Poster
Cash: $ 0.40
Joined: 26 Sep 2012
I agree with you and suggest you that please rent out your own house for a year or 2 years and hire some house in the city for small time period. Don't sale the house. House is a precious thing plz don't lost the house.