All Forum Posts by: Dom Smith

@Jaysen Medhurst thanks Jaysen. We definitely plan on offering them that option! 

While the biggest problem may be the 2/1, I do think the market has taken it's toll and definitely has not recovered to where we were in the early 2000s.  The house sold in 2005 for 255K, 220K in 2010 and should sell for around 200 now.  I've seen several homes of varying bed/bath counts follow a similar trend for houses that have not made significant improvements, in this area, over the last 10 years.  

Is 2/1 my biggest obstacle at this point? No doubt, but I'd have to think central CT's market is playing a role - to some degree. 

First, let me say that I am very appreciative to all of the feedback I've received, lots of ideas to take forward, so thanks to all. 

Remigo - I'm not a professional, so can't say for certain, but I'd think central CT hasn't enjoyed the same upward movement that Fairfield county has seen over the last several years.  With jobs fleeing the state left and right, especially around Hartford county, there hasn't been much or any, turnaround in my area.  My other obstacle is the 2/1 comp, for which there is very little inventory in my area to make a fair comparison. The few 2/1s that do sell are often significantly smaller, on a busy street, no garage, no private yard for which my property is opposite in each of those areas.  That said, from looking over recent sales (~last 3-6 months), it does seem that values of "comp" homes are trending up compared to what I was seeing when my home was recently on the market.  Hope that continues.  

Based on offers I've received and the home being under contract, the market has more or less assigned a fair market value of around 200-205K.   

Filipe - I'm glad you brought up that question, I often read/hear about that very question and always ask, "am I buying it at the original price I purchased it back in 2010, or am I buying it on the amount of loan that is left to pay it down?" If it's the pay down, I would absolutely buy it at that price, if it's the original value - definitely not.  

Thank you Rick, I did not realize selling a property at a loss had any tax benefits, so I definitely need to look into that further.  I might add, when I was trying to sell initially (at a loss), it was not yet converted to a rental property.  Now that it is a rental property, I thought I could only claim any lost value since the conversion. Additionally, being in the first year of the rental, I'm not sure what the hit is going to be come tax season, with the rental income received minus the property's expense write-offs and any depreciation that can be claimed, other factors that I'll need to consider going forward as well. 

Ideally, long-term, I'd like to stay involved with real estate investing - just not sure that this property is right for a long term rental property.  As Brian mentioned, it's definitely not ideal that I'm only basically breaking even, but was curious as to what others have done / are doing, in this situation.  

Thanks for that feedback! During the original go round at selling, we were under contract for 25k less than what we paid in 2010, which is pretty much the norm, in this market, for CT homes without any significant improvements. The sale fell through due to unreasonable buyer demands following the inspection - first time homeowner who essentially wanted a "brand new" 70 year old home. We've been reluctant to take on any big modifications, but may need to revisit that if the numbers work. We've done some small value adds - painting, new appliances, new counters, along the way. Our idea has been to rent, while paying off some additional principal along the way, while *hoping* the market turns around eventually, where we wouldn't lose as much in a year or two from now.

Hello! Fan of the podcast, finally signed up for the forums.  Quick introduction about myself and looking for the proper forum to repost my question/situation, below. 

I live in the great real estate market of Connecticut and thus, became an accidental landlord when my primary residence (2Bd/1Ba) failed to sell. Instead of taking a big loss on the home, I decided, and was fortunate enough to turn it into a yearly rental after moving to our new, primary residence.  After the winter it will be time to assess whether to take another stab at selling the home, or continuing to rent for another year.  I have about ~40K equity in the rental and owe about $157K on the loan, but the monthly rental income only covers the mortgage payment + insurance + taxes + an additional $75 a month, which I put aside for repairs and anything that may come up.  We're essentially breaking even. We have great, low maintenance tenants, who we believe would likely sign for another year, if we don't decide to sell the property.  We also live close by, so we have the convenience factor in our favor when we do need to get over there.    

The roof, windows and furnace are all about ~10 years old, so while I'm hoping to avoid any big repairs in the near term, every year is another year closer to something that needs to be replaced.  

Since the loan will not be paid off any time soon by solely making monthly payments, does it make any sense at all to continue renting only breaking even, or should I pull the trigger on the sale and take what I can get for it, even if it means taking a big loss from my purchase price in 2010, just to be done with the house? We're leaning toward the latter, but interested in the thoughts/opinions of the community.  Again, my apologies if this is posted in the wrong forum and I will happily move it to another forum, if need be. 

Thanks!