We own two properties right now. Our primary residence and our prior residence. Our primary residence was bought with cash. No mortgage! Our prior residence has a mortgage of $59,951.78. The payment, including PMI, property taxes, and homeowners insurance is $667.61 per month.
I’ve always had an interest in rental properties. Due in part to my obsession with the HGTV show ‘Income Properties’. Great investment for passive income. Or is it? I’ll never know. After renting to a relative, as a favor, I’ve realized I am not cut out to be a landlord. I do not deal well with the stress a rental brings.
Things we never had problems with while living there for five years, seem to be nonstop problems, despite being new systems. Plumbing, electrical, HVAC. You name it, they complain about it. We gutted this house in 2011, everything is brand new! This weeks fun was a shattered top of the electric stove (glass cooktop). There’s another $400 down the drain. The appliances are all new. That stove was worth well over $400, but we can get a reasonable replacement for $400. The brings our out of pocket repairs to around $2,600 since November 2016. Not even four months.
The #1 goal for 2017 is to sell the rental house. While I loved the idea of keeping it “in the family”, this arrangement is not working out. Selling could net us up to $70,000. Realistically probably in $40-$50,000 range after fee’s. One of my better life choices was buying a home during the height of the recession. Lots of equity has built up. I’m going to look into ‘selling by owner’ vs using a real estate agent. We could save at least 6% doing that, I’d just need to hire a real estate attorney for closing.
Of course getting renters out and house onto the market is going to take some effort. The rental lease is up in July. I wish it were sooner. Putting a home on the market in spring would be ideal. I cannot list before getting the renters out, because we’re looking at about $3-$5000 worth of repairs, such as carpet replacement, to be done before listing. I’m estimating repairs will take 3-4 weeks before it’s cleaned up and ready to market.
It’s frustrating. Especially when it’s family. This is definitely not the ‘passive income investment’ we once dreamed of having. Ha!