What should I do?
Hello everyone! I'm looking for some advice as my family is looking to purchase some property and I want to see what you all would do in our situation. Here is the gist of it:
Currently we have been in our house in Highlands Ranch, CO for a little over 6 years. We have done some remodeling to it and finished out the basement fully. Honestly, we love the house, it just has a little bit of a small yard for our 4 kids as they continue to grow. The house itself is a 4 bed, 4 bath with an office that also could be a bedroom. We have had the house valued by our realtor. She has said we could sell it for around $800k. We owe about $375k on it and have an amazing interest rate at 2.8% that I am struggling with the idea of parting with.
We're looking at properties around $900,000 - $1,000,000 that have some acreage and are out of the rural area as that is where we would prefer to live. Ideally if we can find such a property, we could possibly rent out a shop to my work company for a monthly fee as well.
Also, a side note that may be of value to this while situation is that I am in line to eventually take over the company I work for within the next 5 years maximum. It is a small business where my father-in-law and I are the only full-time employees. He is nearing retirement and is planning for me to take over fully once he steps away. This is one of the primary reasons I would like acreage to account for the business and the direction it is headed.
My question is this: With such a low mortgage rate on our current home, would we be better off to rent out our current home rather than sell it? Is a HELOC the best way to have a down payment for our next home if we want to keep this one? I am not positive what the home would rent for each month, but I don't think $4,500 is completely out of the realm of possibility for our area. Ideally if I would have a property manager take care of finding the renter and the day-to-day work needed I'm assuming that would be for 10% of the rent (this is what I have been quoted by other property management companies)?
We have been quoted a HELOC that has a higher interest rate than the mortgage so I wasn't sure if this was a good financial choice either. However, once the HELOC is paid off the cashflow would be amazing!
I know there has to be some sort of way to leverage our current rate and property better than simply selling for the equity that we have earned- I'm just wondering what that path is and what that would look like? I appreciate all of your thoughts and any advice you may have as all of you know far more than I do in this arena.