Am I Smart Or Just Antsy?

[Hunter Peterson]

First off, hello! I am new to BP and looking to start building my network in Southern California (Orange County) for RE education/planning and future RE investing. Hello BP! Secondly, a question... If I sold my primary (and only) residence tomorrow, I'd be able to capitalize on a fair amount of appreciation. Also, due to high HOA's, Mello-Roos taxes, and the fact it's an attached house, I don't see it being an excellent rental property in the future. By my rough calculations, breaking even would be the best case scenario if I rented it out. My thoughts are to cash out on my current appreciation and: 1. Rent until the market corrects itself 2. House hack a multi-unit property in So Cal or 3. Buy a home with better long term rental potential. Since the market is near the peak here, I don't want to trade apples for apples, but maybe there are some slightly better apples out there than my current apple?! I'd love to hear opinions from those more seasoned than myself! Thanks in advance for any feedback! -Hunter

[Dave Foster]

@Carlos Altamirano, Since the property is @Hunter Petersons primary residence he cannot do a 1031 exchange on it without first moving out and converting to a rental for a period of time.

However, if he's lived in it for 2 out of the previous 5 years he can sell and take the first $250K in gain ($500K if married) tax free.  

If you truly believe things are at a high and destined to stagnate or fall then sell  and rent for a while.

@Brian Ploszay, make a good point however.  And House hacking is really just couch surfing v.2 which is slumming with friends v.3 which was how we all got to live near the beach as destitute young bohemians.  That's been around a long long time before it got a new name.