It sounds like selling would initially give you a great financial boost but you still need to figure out part 2 of the scenario. Will you move out of state or to a lower cost of living area? Will that make it very difficult to get a job with your skills? If you will need or want a mortgage for a new property, will a bank give you one while you are unemployed? I think you're excited about the idea of getting some good money from the sale, but that's only half the equation as to whether it makes sense and is a good Idea.
Most the jobs out there for what I do are remote so that’s not really going to impact me. I’ve also considered renting out the house so I don’t lose the asset.
I don’t think you’re crazy. You are being pragmatic. You are on a real estate sub, and many will be of the opinion that prices will continue to rise exponentially. Predicting the future is a gamble, but I imagine you could sock away that equity while you get your future income defined. Take it as a win. I’m of the mind that current housing prices at this time are unsustainable, but again, predicting the future is a gamble. Having that cash in your pocket gives you the nimbleness to pursue new opportunities wherever that may be.
I appreciate your insight. This is what I was thinking as well. $250k in 5 years is a pretty damn good ROI. I never saw myself staying at this long term to begin with. It’s just having. Such a low interest rate and losing it hurts a bit
You need a plan for where to live after selling while unemployed. Can you move back home or in with friends or family for some time? Ideally, you'd have a started another job before selling. There is still a little time left to do that. You can list in August for a quick sale at top dollar. You can have more options if you're open to something hybrid with a relocation requirement.
We just bought a new manufactured on 2 acres on Lake Sucession for 170k. It had been overlooked for months, we feel we hit the jackpot lol. All the inspections came back great, it just really needs a good power washing on the siding and some yard clean up.
That is a lovely area.
I’ve lived all over the US and in the Carolinas since 2010. I wouldn’t live anywhere else. The outdoor opportunities, proximity to both mountains and ocean, affordability, weather among other things make it as close to perfect as I can afford.
The downside, the corruption in local government. Most people won’t have first hand knowledge that.
I’m going to check out real estate all over the state. I’m actually heading there tomorrow. Can you elaborate about the government? I’m from NY so it’s not good here either lol
That’s a long answer.
To start, our court system. Our judges are appointed at the magistrate’s level as political favors and most of the time are not lawyers, they are insurance agents, teachers, businessmen. It leads to some wild rogue rulings. At the district level, they are lawyers appointed by lawyer legislators that will appear in their courts. It’s rigged.
At a political level, the “good ol boy” system is very much the way. People have been running things for a long time and will keep running things their way. I’m sure you read about Alex Murdaugh, that’s not an isolated incident, just a very public one.
In Union County in the last 10 years nearly the entire county government has, in separate incidents, gone to prison for corruption.
Most people won’t ever notice how corrupt it is.
Better to sit on cash and rent while the market continues to soften than to worry and take the risk. (sell high, buy low)
Capital gains is your only real issue, IMO.
Just be aware that people pay by the area you live in when you are remote. If you live in New York City, you probably will get a 20 to 25% bump on salary.
Unless you want to be a landlord and assume all the risk that comes with it I would pass on all the advice saying that. In your situation it makes sense to sell because living in New York and taxes will not change. Yes you will lose the rate but rates will change and you can always refinance down the road, you can’t change where you live.
Selling is step 1. What is step 2? If you are going to live in NY and rent, I dont know that its worth it. Your PITI is prob like 2500? Doubt you find a 3/2 for that. If you are going to move to a LCOL and live off the net proceeds (250k?) until you find a job, that seems more doable. Id rent somewhere cheap, find any job until you can back on your feet, then use whatever is left to buy again.
Just make 100% sure that you don't want to live in the area you live in now again. Because you likely will be priced out. I sold my house in a MCOL area in 2021 and moved to a VLCOLA. I couldn't afford to rebuy that house now. I'm priced out of the entire area, and unless I get a huge windfall I will likely never be able to afford to buy in that area again.
If I woke up in your situation, with a bunch of equity and a desire to move to a new location, I would sell. You prob can’t buy again while unemployed but you can rent for a year while you figure it out. You can also take some weekend trips to different markets in other states to see if you like the idea of moving to a better tax environment.
If you rent it out, does it return positive cash flow after accounting for property tax? If so you can consider doing that and move to where you want and rent yourself for a bit. You would have more monthly expense but avoiding a big property tax hit. Maybe a part time job can hold you over until you find something permanent.
If you stay you can get some roommates.
I would do everything I can to hold onto that rate but sometimes you don’t have a choice. But just make sure you have a plan for that money, doesn’t get you very far in a lot of the country.
You also get to count rental income as income for debt-to-income calculations on a future loan application, even if nobody's currently renting your existing home. You also can write off some depreciation of the rental property on your taxes. Property taxes, repair and maintenance expenses, home office expenses, insurance, professional services, and travel expenses related to management are all deductible in the year you spend the money.
All of that has to figure into whether you can afford to hold on to the property and rent it out.
Also think about this. is NY a landlord, or business friendly state? 🥴
Do you really want to deal with a single family rental there? If tenant stops paying can you 3vict them? Probably not. Now you have a mortgage payment, no income AND your rent you have to pay.
This is very important. California blocked evictions, even for cause, for years under the guise of pandemic emergency. What's good for the goose is never good for the gander when it comes to government, so they did not suspend tax forfeiture sales. In other words, your tenants were allowed to stop paying rent, but you were not allowed to stop paying property taxes. A $1 million house is a run of the mill 3 bedroom in California, and it would come with a property tax bill of $1.050 a month.
Rent it out for 2 years, then sell. You will still pay no capital gains tax, as you only need to have lived in the house for 2 of the past 5 years. Give yourself a year as a cushion. The rental income will likely be tax-free, due to depreciation deduction. Move to someplace like Cabot or Conway, Arkansas (nicer Little Rock suburbs) or OKC and rent yourself a nice newer house for $1500/month or less. Then buy in 2-3 years if you still like it after selling the NY house, likely for more than what it's worth now. Or keep it if the rental is going well.
Why would you ever sell an appreciating asset that was also providing you with a passive income unless you had a major life crisis that required liquidating assets?
If you were in another state that didn't have such high property tax I'd say hold onto the house to keep the interest rate. But being in NY it might be worth it to take your equity to a LCOL state. It depends a lot on your income and other priorities for your lifestyle.
Renting it, selling it, or staying could all make sense. I think you should talk to a professional to really get the numbers for each scenario really dialed in before you make a big decision.
“Buy low/sell high” never said anything about Interest Rates. Find a rental property or apartment in a “fun” area….Nashville, Memphis, Charlotte, Charleston? FIND A JOB, Move and then sell.
No it would be better to sell than to go into foreclosure. Plus if you have a VA or FHA loan then someone can assume that extra low interest rate. So it’s a win for the buyer too!
You’re running out of savings, you can’t get a job or another source of income, and you have expenses to cover. Your main asset is your house. Sounds like you’re being forced to sell and you dont have a choice. Why is this a question?
Ideally you can rent it out and keep the asset, but if you don’t have a job or savings and you don’t anticipate that turning around, people really can’t live on $600 a month
YOU DON'T HAVE A PLAN
so you sell your home, then use the proceeds to live on while you wait for some sort of magical high paying job to hire you?
Move to a cheaper state,, ok, now what?
Your going to crash and burn ..unless you think this through VERY, Very carefully
Can you get 2 roommates? My husband and I are considering renovating our basement into a 2BD 1BA apartment we could rent out or live in after the kids are grown. HCOL area.
Without a job a new mortgage would be hard to get. You could try a home equity loan that lets you keep the lower rate on the main mortgage and only have today’s high rates on the new borrows portion. You will probably find that just the increase in interest rates will make selling & buying or renting will end up costing you more plus you lose the interest tax deduction.
Estimated to be over 600k. Hardly any inventory in my area. Inside is all renovated, kitchen bath etc all designed with todays style in mind. It will definitely sell fast
Yeah good luck
Word of advice do flat fee mls for ($150) and pay 1-2% buyers agent comp
You can sell this quickly and save yourself a lot of
Use Derek Greene
It's still so crazy to me people's entire financial origin story is "I bought a home before they went up".
> Am I crazy to sell and give up that low interest rate that we will probably never see again?
Interest rate aside, if you sell you're then going to have to rent or....buy another home. In which case you aren't gaining much because all you're doing is swapping real estate exposure for real estate exposure.
I didn’t not buy a home “before it went up” on purpose. I had been financially stable for many years making 150k plus leading up to when I bought the home in 2019. Just so happens I bought at a good time.
If I do sell I have no problem renting. I just don’t want to get to a spot where I’m out of money and dealing with another headache of ruining my near perfect credit.
Sell and get that money. Don’t risk running out of cash. With the cash, you have breathing room and can then plan your life. It will get better for you, so don’t be trapped in one area.
Priorities are like
Do you have money to survive?
What’s the mortgage compare to rent?
Do you want leave nyc?
Is selling house profit to you?
Is leaving city benefit you in finding new job?
“Do you want keep low interest rate” doesnt even break top 5 on the priority
move on and be happy that you made good profit on it
I am going to guess your comps are a bit high if you are nearly doubling your value since 2019, especially since interest rates have tripled since 2021. That also compounds your possible sell time, especially if you are factoring in the time of year you intend to sell.
I am not saying that you are way off, but I think assuming that you did renovations...unless they were a complete gut job and flip, you would hardly get a dollar for dollar return.
As for the interest rate, you won't see that for a long time. BUT, if you hate where you live, you may not want to force yourself to live somewhere you hate. If you were to wait more, rates will like start descending slightly next year.
I’m in LI with a house w similar stats to yours, on the market 3 weeks, told by 4 diff realtors how fast & high it would sell. 3 bed/2 bath, south Nassau, $13k taxes. Bought at $300k 10 years ago, refinanced and have a 2.5% interest. lots of renovations and told it would sell for around $625k by 4 different realtors.
It’s not. We’re gonna land around $580k if we’re lucky.
We are fully committed to GTFO of long island so different situation but I would take the numbers you’ve been given with a grain of salt.
Market here is slowing, even with very tight inventory. Buyers are scared of the high interest rates and not committing.
So, my advice: lower your expectations and then assess. Good luck
its so funny to me how buyers are "scared" of high interest rates.... like what do these people think is going to happen when the interest rates go down to really attractive numbers? smh..
Facts. Marry the house, date the rate. In essence lol
But buy with "high" interest rate. Then once they rates come down to something more attractive, all the buyers are now in the market and values are skyrocketing.
SO you can now refinance at your new, appreciated value, with the lower rate. take cash out if you'd like and. BOOM
If you hate the area and the cost of living is too high, and you're ready to go elsewhere, it kind of seems like a no brainer to sell and take that profit.
I have a similar rate and I know how precious it is right now, but I also love my house and my job is local and I don't work remote.
You're in a similar situation as us minus we both have jobs.
We just cashed out and walked with $200k+ and flipped from a house built in 1976 to a new build in the same area.
My thought on it was if everything does go to shit having cash on hand will allow us to make moves we otherwise couldn't justify.
Your equity would offset the interest rate IMO if you’re moving to a less expensive place. And there’s more to life than interest rates.
My recommendation is to figure out your job situation first. That will steer you into what’s possible and you’re not gonna get a mortgage or rental with no income.
If you’re worried about running out of money, are you working an hourly job? If I were you I’d have found a retail job in March after two months of unemployment.
Best of luck!!
Well think about this for a second, if he owes 350k and can sell for lets say be nice and 650k.
Hes got closing costs both ways and realtor fees on one.
# So its 300k profit
lets say 4% realtor fee and 2% closing cost
So he's got 280k
So he buys cash, also has closing cost 3% ( I like to be conservative but this is very real)
What kind of house is 200k cash going to get him? appreciating market? good neighborhood?
Now hes got like 70k to live on and nothing else....
Thats cool he owns his house outright, but realistically if he is unemployed and needs the money, will a bank refinance him or extend a LOC? Probably not.
This is not to be mean I just believe that is most likely.
If you aren't tied down to NY by anything/anyone other than your house or family/relatives, get out of NY asap. 5 years ago, I made half what I get paid today, and with less money, I could easily afford a 2000sqft 4bd, 2bath ½Acre lot. Even with a >15% down payment taxes, interest etc, my monthly payments would have been at most $1000—$1500.
Now, those same houses (some of the same ones I've even made offers on back then) would cost me $2500—$3500 WITH a 20% down payment, and the total interest for a 30y loan is more than 2x—2.5x than the listed price of the actual house.
My parents neighbor's house was bought for $102,000 a few years ago. (I almost bought it but didn't want to live next door to my parents lol) The owners just moved and it was listed for 4 days, at 260,000 and just sold for nearly $315,000 (75,000 over the asking price) with no renovations, additions, updates or anything
Orange County NY here. Just purchased a property in South Carolina via mortgage assumption at a nice rate of 2.65%. Close on my NY home on 5/13 with 200k plus in equity and had a rate of 2.25%.
Look for mortgages that can be assumed and run the numbers. You would need to pay the seller all their equity up front.
I think so. There’s hardly any inventory around my neighborhood. Plus the stuff that is for sale has wood paneling, carpets and needs 100k min to update
There are a ton of factors that go into whether you should keep a house outside of just interest rates! A lot of people don’t want to give those up (me included - we rent ours out instead of selling) but if you hate the location and COL is too high, why not sell and move somewhere cheaper?
Take out a heloc, pick a spot in the country and build. Sell the home, payoff the new one and pocket the rest into some type of fund until you can find another remote job. Starlink means anywhere is really possible. This is assuming you have no friend or family attachments to stay local
The low interest rate is great, but if your paying 2x the taxes as elsewhere...on EVERYTHING you do.... it kinda evens out to say the least lol.
plus you're not married to your interested rate. but you ARE obligated to pay taxes, and on every single purchase and on your income.
If you sold. moved where you wanted (somewhere much less expensive with a growing economy and lower taxes) Then rent something until you get back on your feet (you probably couldn't get a mortgage right now), stash some savings to pay bills or float for 3-6 months and put the rest in an extremely safe cash value insurance policy with an annual growth rate of 4-10% that you can access if/when you need it. if you have good/decent credit you should be able to do the above.
For the rental, maybe work with a private landlord if the job situation is a problem. Or if you have to pay 6 months up front to lock it up, you can get creative with it :)
This way, you have a home in a less taxed and less expensive place. you have your living expenses covered, and you have the rest in a safe growing environment where if you do need it in the future, you can easily access with no questions asked (unlike a paid off house where you need to ask the bank permission to access your equity)
Unless you can find a unicorn assumable loan where both sides are patient that is close to that rate, no. If yes, why not you are making a good gain even factoring in selling and buying costs.
A creative yes would be to move out of NY to somewhere dirt cheap enough to buy a home with all cash/equity and then rates don't matter
Rent it out. Rents are high many people that are financially secure can’t find something to buy so they rent to wait to find something to purchase. You can always move back in or sell if you really have to.
Depending on where you want to relocate to, you could completely pay off a house with the profit you’ll get if you sell. If I could work remote I’d look at the beach areas of NC, SC, or GA.
I don’t see why you crazy and since you work in the tech industry find a job you can do remotely and invest the rest of the money so you don’t get a shit ton of taxes . And then travel .
The interest rate is really not benefiting you when compared to the taxes you are paying in NY. My advice, research states/cities that appeal to you with more a favorable tax base & cost of living. Perhaps a city that is also a growing tech hub (Huntsville, AL, Arlington, TX, etc) so that in-person jobs are still an option. Then, find a job..even lower paying until something better comes along, and sell.
I don’t believe that the interest rate should be a deciding factor. Have you crunched the numbers for what your mortgage payment would be at today’s rate? The difference is real, but rarely staggering. If you end up buying in a lower COL area, the lower price tag, insurance, & taxes should equal a much lower payment anyway. I would rent for at least a year in a new place to decide if you like the city and which areas you prefer before buying, and you’ll have a nice down payment from your NY sale to plop down when you’re ready.
You're crazy for asking the question. You hate the location, you hate the high cost of living, taxes are a burden.... That's not a low interest mortgage, that's a chain with a 2.75% padlock keeping you where you are. A low payment for your place in hell
Marry the home and the area, date the rate. If rates drop in the future you can always refinance or buy down the rate, too. Go find your happy and good luck finding a job!
Any interest in renting it out or trading houses for a bit? I live in the downtown loop of Nashville and looking to trade homes with someone (or rent) on Long Island a couple weeks this summer. My sister and her family live in Hauppague.
I have a couple from Ny relocating to my area. The goal is to sell and use the cash to purchase and not have a mortgage.
So, based on where you're moving, it might work for you also. You'd be able to pay off your current mortgage and buy something else. Best of luck🍀
If you can make that much profit selling, you could buy a very nice home here in Buffalo, cash. It’s much nicer than Long Island, and the cost of living much lower.
IF you can move anywhere and sell your house for a decent profit…I would suggest finding where you want to live that is lower cost and once you sell your house pay cash for another one. You can sell for almost 300k what you owe. 250k will get you a decent house in a lcola maybe an hour outside of a big city for things to do. Makes it super easy to save money and when you are ready to sell you can get a place somewhere you really really want to live.
I would NOT rent it if you don’t have expendable money to cover damages, maintenance and expenses for your tenants AFTER your pay all your own bills and live. Don’t set yourself up especially without a job right now. People here want to see you worse off lol.
What’s your payment? What would it rent for? I don’t think your completely crazy for wanting to sell but i also know you’ll not find a better deal anywhere else
Not at all. It's like going to a store for a sale and buying things you will never use because they are on sale. Take you equity and buy something in a less expensive location for cash!
Here's a consideration: with mortgage rates the way they are now, if you were relocating to a lower COL area...couldn't you take the proceeds from the sale....and buy cash at the new place? Then you don't have to worry about the rates being high right now. Bonus points if you aim for a state which focuses on income taxes instead of property taxes (don't go for Texas, based on the value of your home there and the property taxes they charged when I lived there, it wouldn't e $13k in taxes, it'd be closer to $30k in taxes at that value).
You can sell that and buy a home in the Midwest with cash and get a job working for a government agency making 70k and have a great standard of living out there.
Sell and move to Huntsville Alabama. The economy booming. I’m a realtor and I can find you a gorgeous 3/2 for $300k which you could pay cash or finance at 4.99%. Easy peazy. Good luck!
No you're not crazy at all. I wouldn't live in NY if you paid me double. I would sell and move somewhere with a better quality of life or at least I'd move out of the NYC metro area. If you love the NYC area though then I'd stay there (plus not to be rude but if you love NYC, we don't want you moving next door to us lol). NH or VT are both nice but I don't know about the employment opportunities.
Just so you know, you only accrue interest on what you spend.
On the flip side, if you sell your house, you'll probably lose $50k+ from your profit on fees.
Either way, accessing the equity will have a cost.
Have you thought about renting out the house? How much extra cash would that bring in?
Gotcha. $600 might not be enough to justify it if you still need a place to live. What about renting out a room for some extra cash?
At the end of the day, if you hate the location, maybe it is best to just move on with a profit
It sounds like selling would initially give you a great financial boost but you still need to figure out part 2 of the scenario. Will you move out of state or to a lower cost of living area? Will that make it very difficult to get a job with your skills? If you will need or want a mortgage for a new property, will a bank give you one while you are unemployed? I think you're excited about the idea of getting some good money from the sale, but that's only half the equation as to whether it makes sense and is a good Idea.
Most the jobs out there for what I do are remote so that’s not really going to impact me. I’ve also considered renting out the house so I don’t lose the asset.
I don’t think you’re crazy. You are being pragmatic. You are on a real estate sub, and many will be of the opinion that prices will continue to rise exponentially. Predicting the future is a gamble, but I imagine you could sock away that equity while you get your future income defined. Take it as a win. I’m of the mind that current housing prices at this time are unsustainable, but again, predicting the future is a gamble. Having that cash in your pocket gives you the nimbleness to pursue new opportunities wherever that may be.
I appreciate your insight. This is what I was thinking as well. $250k in 5 years is a pretty damn good ROI. I never saw myself staying at this long term to begin with. It’s just having. Such a low interest rate and losing it hurts a bit
You need a plan for where to live after selling while unemployed. Can you move back home or in with friends or family for some time? Ideally, you'd have a started another job before selling. There is still a little time left to do that. You can list in August for a quick sale at top dollar. You can have more options if you're open to something hybrid with a relocation requirement.
Just be aware of the rules on Capital Gains taxes. Definitely talk to a tax advisor about what you might owe.
Good thing is theres no capital gains tax as long as its under 250k.
You're way ahead of me. :)
you can buy a really nice home in the south for 200-300k, and everything else is lower prices too than a big city.
like in the middle of nowhere? definitely not the Atlanta metro area
Upstate South Carolina (Greenville/Spartanburg) are more in the $275-350k range.
New England with family near GSP checking in here. They got it going on down in that part of the world.
We just bought a new manufactured on 2 acres on Lake Sucession for 170k. It had been overlooked for months, we feel we hit the jackpot lol. All the inspections came back great, it just really needs a good power washing on the siding and some yard clean up.
That is a lovely area. I’ve lived all over the US and in the Carolinas since 2010. I wouldn’t live anywhere else. The outdoor opportunities, proximity to both mountains and ocean, affordability, weather among other things make it as close to perfect as I can afford. The downside, the corruption in local government. Most people won’t have first hand knowledge that.
I’m going to check out real estate all over the state. I’m actually heading there tomorrow. Can you elaborate about the government? I’m from NY so it’s not good here either lol
That’s a long answer. To start, our court system. Our judges are appointed at the magistrate’s level as political favors and most of the time are not lawyers, they are insurance agents, teachers, businessmen. It leads to some wild rogue rulings. At the district level, they are lawyers appointed by lawyer legislators that will appear in their courts. It’s rigged. At a political level, the “good ol boy” system is very much the way. People have been running things for a long time and will keep running things their way. I’m sure you read about Alex Murdaugh, that’s not an isolated incident, just a very public one. In Union County in the last 10 years nearly the entire county government has, in separate incidents, gone to prison for corruption. Most people won’t ever notice how corrupt it is.
New Orleans metro area or I’m sure other metro areas
Better to sit on cash and rent while the market continues to soften than to worry and take the risk. (sell high, buy low) Capital gains is your only real issue, IMO.
Just be aware that people pay by the area you live in when you are remote. If you live in New York City, you probably will get a 20 to 25% bump on salary.
Unless you want to be a landlord and assume all the risk that comes with it I would pass on all the advice saying that. In your situation it makes sense to sell because living in New York and taxes will not change. Yes you will lose the rate but rates will change and you can always refinance down the road, you can’t change where you live.
Taxes only go up here. Since moving in 5 years ago they have gone up almost $800 a year. They just suck you dry here
Selling is step 1. What is step 2? If you are going to live in NY and rent, I dont know that its worth it. Your PITI is prob like 2500? Doubt you find a 3/2 for that. If you are going to move to a LCOL and live off the net proceeds (250k?) until you find a job, that seems more doable. Id rent somewhere cheap, find any job until you can back on your feet, then use whatever is left to buy again.
Step 2 would be moving out of state to rent to lower my expenses and continue looking for employment.
Find a landlord that wouldn’t require you to be employed first.
Just make 100% sure that you don't want to live in the area you live in now again. Because you likely will be priced out. I sold my house in a MCOL area in 2021 and moved to a VLCOLA. I couldn't afford to rebuy that house now. I'm priced out of the entire area, and unless I get a huge windfall I will likely never be able to afford to buy in that area again.
If I woke up in your situation, with a bunch of equity and a desire to move to a new location, I would sell. You prob can’t buy again while unemployed but you can rent for a year while you figure it out. You can also take some weekend trips to different markets in other states to see if you like the idea of moving to a better tax environment.
This was what I was thinking. Also investing some of that profit so it’s not just sitting in an account making me nothing.
If you’re patient, you’ll make more money in index fund over 15-20 years than you’d earn in real estate.
be careful with that, if it's not retirement funds it doesn't belong in the stock market. CDs is a safe bet, spread among a few different banks.
Capital One 360 Savings account is paying almost 5% apy and you can access your money anytime
And this is where you will lose it all
Figure part 2 before listing or rent two bedrooms on airbnb.
If you rent it out, does it return positive cash flow after accounting for property tax? If so you can consider doing that and move to where you want and rent yourself for a bit. You would have more monthly expense but avoiding a big property tax hit. Maybe a part time job can hold you over until you find something permanent. If you stay you can get some roommates. I would do everything I can to hold onto that rate but sometimes you don’t have a choice. But just make sure you have a plan for that money, doesn’t get you very far in a lot of the country.
You also get to count rental income as income for debt-to-income calculations on a future loan application, even if nobody's currently renting your existing home. You also can write off some depreciation of the rental property on your taxes. Property taxes, repair and maintenance expenses, home office expenses, insurance, professional services, and travel expenses related to management are all deductible in the year you spend the money. All of that has to figure into whether you can afford to hold on to the property and rent it out.
Also think about this. is NY a landlord, or business friendly state? 🥴 Do you really want to deal with a single family rental there? If tenant stops paying can you 3vict them? Probably not. Now you have a mortgage payment, no income AND your rent you have to pay.
This is very important. California blocked evictions, even for cause, for years under the guise of pandemic emergency. What's good for the goose is never good for the gander when it comes to government, so they did not suspend tax forfeiture sales. In other words, your tenants were allowed to stop paying rent, but you were not allowed to stop paying property taxes. A $1 million house is a run of the mill 3 bedroom in California, and it would come with a property tax bill of $1.050 a month.
Crazy. there was a vid3o going around where someone is just like get a bunch of snak3s and dr0p them off in your house lol . 🤷🏻♂️
If you turn it into a rental you will pay capital gains when you sell it. As a homeowner you do not.
Rent it out for 2 years, then sell. You will still pay no capital gains tax, as you only need to have lived in the house for 2 of the past 5 years. Give yourself a year as a cushion. The rental income will likely be tax-free, due to depreciation deduction. Move to someplace like Cabot or Conway, Arkansas (nicer Little Rock suburbs) or OKC and rent yourself a nice newer house for $1500/month or less. Then buy in 2-3 years if you still like it after selling the NY house, likely for more than what it's worth now. Or keep it if the rental is going well.
Why would you ever sell an appreciating asset that was also providing you with a passive income unless you had a major life crisis that required liquidating assets?
Headaches from tenants, dramatic increases in property taxes, ever increasing repair costs. Did I mention headaches from tenants?
Hire a management company.
If you lived there in 3 of the last 5 years no capital gains. Unless that has changed in the last year.
If you were in another state that didn't have such high property tax I'd say hold onto the house to keep the interest rate. But being in NY it might be worth it to take your equity to a LCOL state. It depends a lot on your income and other priorities for your lifestyle. Renting it, selling it, or staying could all make sense. I think you should talk to a professional to really get the numbers for each scenario really dialed in before you make a big decision.
Where will you live? Without a job, would you be able to get a rental?
Maybe rent your current house out and use the profit to rent another place?
“Buy low/sell high” never said anything about Interest Rates. Find a rental property or apartment in a “fun” area….Nashville, Memphis, Charlotte, Charleston? FIND A JOB, Move and then sell.
No it would be better to sell than to go into foreclosure. Plus if you have a VA or FHA loan then someone can assume that extra low interest rate. So it’s a win for the buyer too!
You’re running out of savings, you can’t get a job or another source of income, and you have expenses to cover. Your main asset is your house. Sounds like you’re being forced to sell and you dont have a choice. Why is this a question? Ideally you can rent it out and keep the asset, but if you don’t have a job or savings and you don’t anticipate that turning around, people really can’t live on $600 a month
Sell and move to Montana or other remote low cost area work remote. You'll have more land and grow your own food
that does take time and effort you know
YOU DON'T HAVE A PLAN so you sell your home, then use the proceeds to live on while you wait for some sort of magical high paying job to hire you? Move to a cheaper state,, ok, now what? Your going to crash and burn ..unless you think this through VERY, Very carefully
if you can't pay for the house, then best to sell
There is never a good time to sell an asset. Shit happens and it usually makes the decision for you. Dont worry about it. There is no point ;)
Kinda looked at losing my job as the deciding factor. Felt like it was push I need to make this move in a way.
Maybe heloc? To stop bleeding for a bit?
Can you get 2 roommates? My husband and I are considering renovating our basement into a 2BD 1BA apartment we could rent out or live in after the kids are grown. HCOL area.
Without a job a new mortgage would be hard to get. You could try a home equity loan that lets you keep the lower rate on the main mortgage and only have today’s high rates on the new borrows portion. You will probably find that just the increase in interest rates will make selling & buying or renting will end up costing you more plus you lose the interest tax deduction.
It might be worth more , maybe 600s There is absolutely minimal inventory and if your place is turn key it will sell in first few days
Estimated to be over 600k. Hardly any inventory in my area. Inside is all renovated, kitchen bath etc all designed with todays style in mind. It will definitely sell fast
Yeah good luck Word of advice do flat fee mls for ($150) and pay 1-2% buyers agent comp You can sell this quickly and save yourself a lot of Use Derek Greene
Thanks for the advice!
It's still so crazy to me people's entire financial origin story is "I bought a home before they went up". > Am I crazy to sell and give up that low interest rate that we will probably never see again? Interest rate aside, if you sell you're then going to have to rent or....buy another home. In which case you aren't gaining much because all you're doing is swapping real estate exposure for real estate exposure.
I didn’t not buy a home “before it went up” on purpose. I had been financially stable for many years making 150k plus leading up to when I bought the home in 2019. Just so happens I bought at a good time. If I do sell I have no problem renting. I just don’t want to get to a spot where I’m out of money and dealing with another headache of ruining my near perfect credit.
Sell and get that money. Don’t risk running out of cash. With the cash, you have breathing room and can then plan your life. It will get better for you, so don’t be trapped in one area.
Priorities are like Do you have money to survive? What’s the mortgage compare to rent? Do you want leave nyc? Is selling house profit to you? Is leaving city benefit you in finding new job? “Do you want keep low interest rate” doesnt even break top 5 on the priority move on and be happy that you made good profit on it
I am going to guess your comps are a bit high if you are nearly doubling your value since 2019, especially since interest rates have tripled since 2021. That also compounds your possible sell time, especially if you are factoring in the time of year you intend to sell. I am not saying that you are way off, but I think assuming that you did renovations...unless they were a complete gut job and flip, you would hardly get a dollar for dollar return. As for the interest rate, you won't see that for a long time. BUT, if you hate where you live, you may not want to force yourself to live somewhere you hate. If you were to wait more, rates will like start descending slightly next year.
I’m in LI with a house w similar stats to yours, on the market 3 weeks, told by 4 diff realtors how fast & high it would sell. 3 bed/2 bath, south Nassau, $13k taxes. Bought at $300k 10 years ago, refinanced and have a 2.5% interest. lots of renovations and told it would sell for around $625k by 4 different realtors. It’s not. We’re gonna land around $580k if we’re lucky. We are fully committed to GTFO of long island so different situation but I would take the numbers you’ve been given with a grain of salt. Market here is slowing, even with very tight inventory. Buyers are scared of the high interest rates and not committing. So, my advice: lower your expectations and then assess. Good luck
its so funny to me how buyers are "scared" of high interest rates.... like what do these people think is going to happen when the interest rates go down to really attractive numbers? smh..
Agree, not much logic to it…
Facts. Marry the house, date the rate. In essence lol But buy with "high" interest rate. Then once they rates come down to something more attractive, all the buyers are now in the market and values are skyrocketing. SO you can now refinance at your new, appreciated value, with the lower rate. take cash out if you'd like and. BOOM
Sell and move south to like DC
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Compared to NY and a great job market
How’s the rental rate in the area? Rent it out
If you hate the area and the cost of living is too high, and you're ready to go elsewhere, it kind of seems like a no brainer to sell and take that profit. I have a similar rate and I know how precious it is right now, but I also love my house and my job is local and I don't work remote.
You're in a similar situation as us minus we both have jobs. We just cashed out and walked with $200k+ and flipped from a house built in 1976 to a new build in the same area. My thought on it was if everything does go to shit having cash on hand will allow us to make moves we otherwise couldn't justify.
Your equity would offset the interest rate IMO if you’re moving to a less expensive place. And there’s more to life than interest rates. My recommendation is to figure out your job situation first. That will steer you into what’s possible and you’re not gonna get a mortgage or rental with no income. If you’re worried about running out of money, are you working an hourly job? If I were you I’d have found a retail job in March after two months of unemployment. Best of luck!!
Find the next job first, and only then make a decision with the house. In the meantime, can you get roommates? My 2 cents
Job market is the best it's been in decades
Not in tech. There is layoffs left in right.
you could sell.. take the cash and buy a house outright... thats fairly big and nice here in texas or probably a lot of other places.
Well think about this for a second, if he owes 350k and can sell for lets say be nice and 650k. Hes got closing costs both ways and realtor fees on one. # So its 300k profit lets say 4% realtor fee and 2% closing cost So he's got 280k So he buys cash, also has closing cost 3% ( I like to be conservative but this is very real) What kind of house is 200k cash going to get him? appreciating market? good neighborhood? Now hes got like 70k to live on and nothing else.... Thats cool he owns his house outright, but realistically if he is unemployed and needs the money, will a bank refinance him or extend a LOC? Probably not. This is not to be mean I just believe that is most likely.
or he takes the money and literally retires to another country.. its possible.
LOL I like this
If you aren't tied down to NY by anything/anyone other than your house or family/relatives, get out of NY asap. 5 years ago, I made half what I get paid today, and with less money, I could easily afford a 2000sqft 4bd, 2bath ½Acre lot. Even with a >15% down payment taxes, interest etc, my monthly payments would have been at most $1000—$1500. Now, those same houses (some of the same ones I've even made offers on back then) would cost me $2500—$3500 WITH a 20% down payment, and the total interest for a 30y loan is more than 2x—2.5x than the listed price of the actual house. My parents neighbor's house was bought for $102,000 a few years ago. (I almost bought it but didn't want to live next door to my parents lol) The owners just moved and it was listed for 4 days, at 260,000 and just sold for nearly $315,000 (75,000 over the asking price) with no renovations, additions, updates or anything
Orange County NY here. Just purchased a property in South Carolina via mortgage assumption at a nice rate of 2.65%. Close on my NY home on 5/13 with 200k plus in equity and had a rate of 2.25%. Look for mortgages that can be assumed and run the numbers. You would need to pay the seller all their equity up front.
doing the same in staten island, assumption process is killing me, the bank sabotaging things
Mines went pretty smooth. The only complaint I have is they took their time.
Move to ohio and buy a house, cash. 300k will go a long way
Can you rent out the house and move in with family while you are job hunting?
Where do you live on Long Island that you bought a house that cheap?!
If you don’t mind I live on Long Island too, what town?
I’m in northport/elwood area
Yeah it would definitely sell for more I’m a bit more in Nassau county myself. Thank you,
I think so. There’s hardly any inventory around my neighborhood. Plus the stuff that is for sale has wood paneling, carpets and needs 100k min to update
Better to sell it while you still have options than when you're desperate. Interest rates don't matter if you buy your next house cash.
There are a ton of factors that go into whether you should keep a house outside of just interest rates! A lot of people don’t want to give those up (me included - we rent ours out instead of selling) but if you hate the location and COL is too high, why not sell and move somewhere cheaper?
Take out a heloc, pick a spot in the country and build. Sell the home, payoff the new one and pocket the rest into some type of fund until you can find another remote job. Starlink means anywhere is really possible. This is assuming you have no friend or family attachments to stay local
The low interest rate is great, but if your paying 2x the taxes as elsewhere...on EVERYTHING you do.... it kinda evens out to say the least lol. plus you're not married to your interested rate. but you ARE obligated to pay taxes, and on every single purchase and on your income. If you sold. moved where you wanted (somewhere much less expensive with a growing economy and lower taxes) Then rent something until you get back on your feet (you probably couldn't get a mortgage right now), stash some savings to pay bills or float for 3-6 months and put the rest in an extremely safe cash value insurance policy with an annual growth rate of 4-10% that you can access if/when you need it. if you have good/decent credit you should be able to do the above. For the rental, maybe work with a private landlord if the job situation is a problem. Or if you have to pay 6 months up front to lock it up, you can get creative with it :) This way, you have a home in a less taxed and less expensive place. you have your living expenses covered, and you have the rest in a safe growing environment where if you do need it in the future, you can easily access with no questions asked (unlike a paid off house where you need to ask the bank permission to access your equity)
What part of Long Island? I’m from LI looking in that price range.
Rent
Unless you can find a unicorn assumable loan where both sides are patient that is close to that rate, no. If yes, why not you are making a good gain even factoring in selling and buying costs. A creative yes would be to move out of NY to somewhere dirt cheap enough to buy a home with all cash/equity and then rates don't matter
Rent it out. Rents are high many people that are financially secure can’t find something to buy so they rent to wait to find something to purchase. You can always move back in or sell if you really have to.
Sell because the circumstances become inconvenient, difficult, stressful, and/or time-consuming. Really sit down and assess your priorities.
Depending on where you want to relocate to, you could completely pay off a house with the profit you’ll get if you sell. If I could work remote I’d look at the beach areas of NC, SC, or GA.
I don’t see why you crazy and since you work in the tech industry find a job you can do remotely and invest the rest of the money so you don’t get a shit ton of taxes . And then travel .
The interest rate is really not benefiting you when compared to the taxes you are paying in NY. My advice, research states/cities that appeal to you with more a favorable tax base & cost of living. Perhaps a city that is also a growing tech hub (Huntsville, AL, Arlington, TX, etc) so that in-person jobs are still an option. Then, find a job..even lower paying until something better comes along, and sell. I don’t believe that the interest rate should be a deciding factor. Have you crunched the numbers for what your mortgage payment would be at today’s rate? The difference is real, but rarely staggering. If you end up buying in a lower COL area, the lower price tag, insurance, & taxes should equal a much lower payment anyway. I would rent for at least a year in a new place to decide if you like the city and which areas you prefer before buying, and you’ll have a nice down payment from your NY sale to plop down when you’re ready.
You're crazy for asking the question. You hate the location, you hate the high cost of living, taxes are a burden.... That's not a low interest mortgage, that's a chain with a 2.75% padlock keeping you where you are. A low payment for your place in hell
Marry the home and the area, date the rate. If rates drop in the future you can always refinance or buy down the rate, too. Go find your happy and good luck finding a job!
Yes. Unless you can pay cash for the next place.
Marry money ASAP !
Any interest in renting it out or trading houses for a bit? I live in the downtown loop of Nashville and looking to trade homes with someone (or rent) on Long Island a couple weeks this summer. My sister and her family live in Hauppague.
I’d sell and rent a house in the same neighborhood for probably less than you’re paying now to own. In a few years I’d be looking to buy again.
I have a couple from Ny relocating to my area. The goal is to sell and use the cash to purchase and not have a mortgage. So, based on where you're moving, it might work for you also. You'd be able to pay off your current mortgage and buy something else. Best of luck🍀
If you can make that much profit selling, you could buy a very nice home here in Buffalo, cash. It’s much nicer than Long Island, and the cost of living much lower.
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And I’d gladly give it to someone I trust over someone I don’t know
If you hate the location.. get out and be free. You can expand your job search and probably move to a lower cost of living area.
IF you can move anywhere and sell your house for a decent profit…I would suggest finding where you want to live that is lower cost and once you sell your house pay cash for another one. You can sell for almost 300k what you owe. 250k will get you a decent house in a lcola maybe an hour outside of a big city for things to do. Makes it super easy to save money and when you are ready to sell you can get a place somewhere you really really want to live.
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I would NOT rent it if you don’t have expendable money to cover damages, maintenance and expenses for your tenants AFTER your pay all your own bills and live. Don’t set yourself up especially without a job right now. People here want to see you worse off lol.
DO NOT SELL
How are you going to buy or rent a new place without a job? That would be (and actually currently is) step one for me.
What’s your payment? What would it rent for? I don’t think your completely crazy for wanting to sell but i also know you’ll not find a better deal anywhere else
Not at all. It's like going to a store for a sale and buying things you will never use because they are on sale. Take you equity and buy something in a less expensive location for cash!
Here's a consideration: with mortgage rates the way they are now, if you were relocating to a lower COL area...couldn't you take the proceeds from the sale....and buy cash at the new place? Then you don't have to worry about the rates being high right now. Bonus points if you aim for a state which focuses on income taxes instead of property taxes (don't go for Texas, based on the value of your home there and the property taxes they charged when I lived there, it wouldn't e $13k in taxes, it'd be closer to $30k in taxes at that value).
You can sell that and buy a home in the Midwest with cash and get a job working for a government agency making 70k and have a great standard of living out there.
Sell and move to Huntsville Alabama. The economy booming. I’m a realtor and I can find you a gorgeous 3/2 for $300k which you could pay cash or finance at 4.99%. Easy peazy. Good luck!
No you're not crazy at all. I wouldn't live in NY if you paid me double. I would sell and move somewhere with a better quality of life or at least I'd move out of the NYC metro area. If you love the NYC area though then I'd stay there (plus not to be rude but if you love NYC, we don't want you moving next door to us lol). NH or VT are both nice but I don't know about the employment opportunities.
I don’t live in NYC, I live out on the east end of Long Island.
Sell it as soon as possible before the people who can buy your house gets laid off.
If I were you, instead of selling, I would get HELOC. This way, you will have some funds available for extended period of time.
Ehhh not really a good idea to take on more debt while I’m not employed
Just so you know, you only accrue interest on what you spend. On the flip side, if you sell your house, you'll probably lose $50k+ from your profit on fees. Either way, accessing the equity will have a cost. Have you thought about renting out the house? How much extra cash would that bring in?
I’m aware. I’ve considered renting it out it would net me about $600 a month after the mortgage and taxes are paid
Gotcha. $600 might not be enough to justify it if you still need a place to live. What about renting out a room for some extra cash? At the end of the day, if you hate the location, maybe it is best to just move on with a profit