All Forum Posts by: Adrian Aguilera

 We did consult with an architect and the options aren't ideal in terms of layout but it is possible (and expensive). Another problem is that we are next to a highway so I'd like to avoid that long term. 

Thanks for the feedback, it's helpful to get some perspective. I agree that holding on is the smartest choice. One element that is a bit tricky is that the employer loan won't count my current primary home as rental income unless I have 2 years of rental. That would make it harder to get a larger loan so I may need to rent for that amount of time anyway. @Jonathan Cope Your idea of renting sooner may make sense for multiple reasons! Unfortunately, I have to purchase the new home locally so options are more limited.

I'm new here but already learning a ton. Here's my situation.

-We bought a 2bed/2bath SFH in San Francisco in 2011 for $600K which has appreciated to around $1.3M or so. We have a $490K mortgage (3.5% fixed) and a $140K HELOC (4.5% variable; used to renovate residence and buy vacation rental). We rent it out on Airbnb when we travel and have made between 15-20K per year.

-We own a vacation rental in Sonoma county that is cash flow positive. 

-I have access to a below market variable rate (currently at floor of 2.75%; cap is 10%) loan that only requires 10% down through my employer for a purchase of a new residence.

I'm trying to plan out the best financial moves going forward. We would ideally like to buy a 3 bedroom in SF (have a 4 year old boy and 1 year old girl) but currently, it's too expensive where we'd like to live. We may have to move out of SF but would like to avoid that if we can.

I've considered the following:

1) Stay in our current 2bed/2bath as long as possible (likely 5 years max) or until the market softens

2) Sell now, rent in SF, avoid taxes and free up gains for other investments and wait for a market to soften in SF or move out of the city in a couple of years if it doesn't.

3) We'd love to keep current home as rental after buying new home. This would be great but would likely mean not buying as nice of a house for ourselves and definitely leaving SF. Rents have softened recently so we'd be close to break even on this but presumably this improves over time.

I've been racking my brain about this lately because we are going to leave the country for 5 months starting in August. This seems like an ideal situation to sell if we decided to go that route since we're already doing some packing up even if we rent out our house while gone. 

The most conservative thing seems to hold on to the house as we are paying down principal and have options if the market does drop in the future. It seems most risky to sell now and rent because the market can keep climbing, further putting us out of range. Any other things I should consider? Any other advice?

Thanks!