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Updated almost 9 years ago, 01/20/2016

User Stats

24
Posts
3
Votes
Drew Brock
  • Northport, AL
3
Votes |
24
Posts

Thinking of renting my personal home once we move

Drew Brock
  • Northport, AL
Posted

Hello everyone,

I am trying to figure out if it make sense to rent my home once we move.  I got a 0 down USDA loan.  We have been in the house for 3.5 years so we do not have much equity.  I was thinking it would not make sense if we sell in a year or so because by the time I pay closing I will not be walking away with much money.  I figured if I could rent this property and cash flow a little, it would be better than selling and making hardly anything.  Below are the numbers.  I don't think the 50% rule gives a fair estimate as I just replaced the AC a year ago and the roof has a while until its lifespan is over.  Those seem to be the big hitters.  The house is in a nice neighborhood close to great schools. House was built in 2003 1600sq ft 3bedroom 2 bath.  This would be my first rental btw.

Thanks for the help.

Purchase price$160,000.00 Current MV 163000
Down payment$0
Closing cost$3,500.00 (rolled into mortgage)
Total Mortgage$163,500.00 3.25%
Mortgage balance$153,000.00 Approx 10K inequity
Rent$1,250
Monthly mortgage payment$705.00
Taxes monthly$50.00
Insurance monthly$150.00
Vacancy8%$100 Area normally has houses vancant for 2 weeks or less
Operating expenses10%$125
Cash flow$120.00
Using 50% rule
Rent1250
Expenses625
Mortgage705
Cash flow-80

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