Looking for guidance - rent or sell

[Jeff Miller]

Hello!

I bought a property in South Florida at the peak in May. It turned out it has polybutylene pipes among other less serious problems. The total cost of fixing everything will be about $50K. I have already invested about $15K to take care of some urgent issues.

If I sell now I would lose about $50K in commissions and lower selling price.

 I have read horror stories of how it took some people over 12 months to fix polybutylene pipes due to a combination of bad contractors and delays in getting permits and inspections. I am worried that if I take on the task of repairing it may take longer than the 2-3 months I can afford.

A third alternative is not to fix the polybutylene pipes and just to rent as is - but I am worried that it could lead to a big problem with the renter and me later.

Does anyone have experience dealing with these types of issues? Any advice regarding this will be greatly appreciated.

Best,

Jeff

[Chris Davidson]

@Jeff Miller Were you not expecting a rehab of around 50k at purchase? 15-20k additionally if the plumbing wasn't planned for, but that is a lot less than a 50k loss on sale. If you are going to do other rehab's I would just get started ASAP and be saving funds where you can and cutting back to stretch that 2-3 month run way out. 

12 months seems extreme to rehab a house. 2-3 months possible if you don't have vendors lined up nor have done remodels before. It sounds like you are looking worse case scenario and starting to freeze/ look for an early exit instead of sticking to your plan of rehab and rent. If this is a long term play a slight change in value today should have no impact on if this bad deal today and was a good deal a month ago. However you are 3 months into it I would start picking up speed before you miss peak rental season.