Hello Sophisticated Spenders!
So I’m thinking about selling one of my rental units.
I have a beautiful home in Northern Virginia. This place was built in 2008 and I picked out all of the carpet, tiling, cabinets and EVERYTHING. I loved that place.
If I loved it so much, why did I move?
Because…
It was too much for little old me: The place is 1500 square feet and I grew into the bigger space. I filled it with things that I simply didn’t need.
The commute was getting old: I used to catch the train to work and that commute time was just about an hour. Sometimes there would be delays, sometimes I’d JUST miss the train and spend lots of extra time waiting.
I wanted to be closer to work: I have a 3 minute commute. Here’s a cute video of me walking to work. (Click here to watch)
I needed to declutter: I moved into a 500 square foot place and I LOVE it! (Yes, it’s still a little cluttered with sewing stuff). However, I downsized tremendously!
Which brings me to the selling aspect.
Why would I want to sell?
The current tenants are horrible! I was blessed with a trouble free tenant the first time around but all good things must come to an end.
I’ll admit the tenant screening was NOT properly done this second time around because I had gotten too comfortable with the process.
I dropped the ball this time around.
What have I learned?
I want to meet any potential renter face to face before renting. I need to look this person in the eyes next time around. I’m 100% sure I would never have rented to this person had we met face to face (or had we even communicated over email). There were a few HUGE red flags on our first meeting (over email), but at that point it was too late because the lease was already signed (note: it’s NEVER too late).
Missing that one step has cost me lots of broken appliances (so far oven, toilet, garbage disposal), lots of late night phone calls and lots of headaches.
I was exhausted!
I had my realtor friend run the numbers because my current tenant’s lease will be over in a couple of months however, it is SO not a good time to sell.
The place is worth $23,000 LESS than what I bought it for and the place is renting around $300 LESS than what it should be renting for.
What’s my final answer?
The numbers are telling me to hold on to the place for a little longer, do better tenant screening, and raise the rent.
So that’s my plan in the next couple of months.
And that’s the importance of an emergency fund!
I don’t have to worry about paying all of the bills if my place has to be empty for a month or two because I have money saved for emergencies.
I can not stress the importance of having an emergency fund.
4 thoughts on “Real Estate: To Sell Or Not To Sell, That Is The Question…”
Hi SS!
I’m sorry this happened to you. Like you, I bought a DC condo in 2008 that I’ve rented out since I moved out of state. When I left I was highly skeptical of using a property management company, but now I’m a true believer. A good property Mgmt co screens and vets thoroughly. I’ve not yet had a bad tenant and I’ve had zero days vacant in between tenants. I don’t deal with any of the day to day, I just collect rent (less their 8% fee). The peace of mind is worth it to me. Note, not all prop mgmt companies are good ones–my first was a dud.
Fun fact, my current tenant needed a consigner–his dad, a partner at a big patent law firm! An added bonus of using a prop mgmt co is that the buffer eliminates any conflict of interest concerns.
That is crazy cool Jami! I’m glad you’ve had great luck. Your place is about to spike in value. Have you seen what they’re building over there?????
Also, keep the property! Every 4-8 years a bunch of people buy/sell. The DMV is pretty stable, and almost always trending up. Mine I way up 🙂
When their lease ends, get the, out ASAP, take losses from their deposit, sue in small claims for the rest. Deduct the losses off of your taxes, and keep it moving.
Thank you for all the great advice!!!!