House advice --

[NetViper]

I am in a bit of a dillema.

We moved out to Georgia in June and our home has been for sale back in Monroe, Louisiana ever since. We have yet to get one bid and we have a pretty good chunk of change tied up in the house. We have had it shown 40 times and nothing. We had one couple want to buy it, but turns our they had no money. Anywya, We have since bought another home here in Savannah and the company has been picking up the tab for our other home. (~1200ish).

As of Jan 05, they are no longer going to pick up the tab and it is going to put us into a fairly tough financial postion. State Farm closed their main office in Monroe 6 months ago and therefore eliminated 1200 people and killed the housing market. In the last 5 months, only 1 home has sold in our price range and under 10 years old in our area.

I am thinking about leasing out the home until the housing market picks up and hope to at least get $1600 a month of so for it. That would cover our expenses and then some. I have no idea how stong the rental market is there, but I know how awful the buying market is.

I don't see the home selling any time soon, and I really don't know what else to do.

Any advice?

Thanks guys.

 

[RPM217]

If the market for sale is bad, than I'd assume that you're not the only one in the position of owning a house that you'd rather not. If the rental market is strong, you might be able to rent out the house for more than your carrying cost, or, then again you might not. As an owner/landlord you will still have substantial liabilities. I'm not a realtor, but I do manage people's finances for a living. If you really want to sell the house, it will always find a buyer at a "price". That price might not be what you feel it is worth, but in order to get out from under the house, you might have to accept less than what you feel it's worth. It's all a matter of what you can afford. Back in the early 90's houses in my old neighborhood dropped by over a 1/3 in value, it took over 5 years for them to recover, and in another 5 years they've gone up an additional 1/3. In the neighborhood that I bought in, homes have doubled in the past 5 years (on average). If the employment market in your old area is so soft, it might be quite some time before values firm up. Speak with a "good realtor" in your old area, see what the rental market is like, and also what price the house needs to be priced at to sell now. Then, make your decisions. Just like in buying a car, do your homework first, than make an informed, intelligent decision. BOL

 

[hlweyl]

The law of supply and demand is in effect here. If your house is priced to high, it just will not sell. I'm assuming other houses within a 10 miles radius of your old one are selling?

Alot of people who sell their houses price too high. There alot of emotional attachment that goes on also. If you have an honest real estate agent, they should be up front with you regarding pricing the house properly. No offense intended, the same thing happened to me.

good luck

 

[MiamieNeSeX]

If you can rent the house and break even(mortgage and taxes) you are ahead of the game. Remember they will be adding to your equity as they pay rent for when you do sell the property.


Armando

 

[NetViper]

The law of supply and demand is in effect here. If your house is priced to high, it just will not sell. I'm assuming other houses within a 10 miles radius of your old one are selling?

Like I said above, no home in our price range had sold in the past 5 months in our area. Our home was made in 2002. I am not sure exactly what radius the realtor used when she told us that.

As far as price, we have dropped it nearly $7K of our original asking price (which was inline with what it should sell for) and have yet to get one real bid. We are getting close to the point of losing money on the home for the sale price.

 

[NsXMas]

That's too bad.

The housing market has been so crazy for the last few years that people forget that you can lose money (over the short-term) on homes.

If you sell now you may take a loss. If you rent you may end up better if you find good tenants. This will help you weather the bad market and sell it in a better market.

It all depends on how much of a loss you are willing to take, or how good of a tenant you find to help tide you over.

Good luck!

 

[NsXMas]

Like I said above, no home in our price range had sold in the past 5 months in our area. Our home was made in 2002. I am not sure exactly what radius the realtor used when she told us that.

As far as price, we have dropped it nearly $7K of our original asking price (which was inline with what it should sell for) and have yet to get one real bid. We are getting close to the point of losing money on the home for the sale price.

That's really unfortunate. But if you want to get out, sell it now. Home prices may decline even further, depending which clown is the next President. I think the housing market bubble has finally reared its ugly head.

 

[T Bolen]

I have had success in moving a hard to sell house by using a lease option. Go to your local bookstore and pick up a book on it in the real estate section. Set your monthly lease rate slightly above market rent, say around 10 %. Offer the buyer a 25 % credit toward the purchase price from the monthly payment. Take a non-refundable option fee up front for the lease option.
an example:
your selling price $100,000
lease option for $2500 fee, $1500 per month lease
2 year term
at the end of 2 years, the buyer will have built up $9000 ($375/mo)in equity, which should qualify them for a mortgage - they then have to exercise the option and secure their own financing.
You win as you get your costs covered, and they will usually take better care of the place than regular tenants.
They win as they get a home price locked in from 24 months ago, and build up equity - they then buy the house for $91,000.
I am not a real estate pro - consult your local professionals for details. Any house can be sold if the terms are right.

 

[Dr.Honda]

Very sorry to hear of your dilemma. I had the same problem when I left
Minnesota. Probably better to take the loss than try to lease it from afar.
Furthermore, I think the real estate bubble is just starting to burst, doubt that valuations will be coming up again anytime soon. Interest rates will be coming up and the supply of homes in the $200-$400 K range is steadily rising.
On the plus side, you will probably be purchasing your next home at substantially lower price than you would have a year ago. Good luck!

 

[Joel]

Wow. Sorry to hear that.
It's unfortunate the house is not in Southern Cali. It would sell quick.
Good luck.

 

[NetViper]

Here is an update: We started at $225,000. We have dropped to $217,900. The couple that originally wanted it, but had no money now has money and offered $195,000!!! Give me a freaking break. They offered $222K when they had no money!

 

[lemansnsx]

Here is an update: We started at $225,000. We have dropped to $217,900. The couple that originally wanted it, but had no money now has money and offered $195,000!!! Give me a freaking break. They offered $222K when they had no money!

Obviously low-balling you since they know how long the house has been on the market. They have nothing to lose so don't hold a low offer against them. Go back to them with a realistic counter-offer after a serious soul-searching on how long you are willing and able to hold onto the house and conversations with a couple of people who really know the current market for houses in the same price range as your former home. I see a couple of realtors listed online for Monroe one of whom seems to do higher-end stuff - can't hurt to talk to a couple of them.

 

[ncdogdoc]

I paid two mortgages for almost a year because I wanted to get "my price" for my first house. After eleven months, I got my price, but with other consessions made, and there is no way the stress of those eleven months was worth the extra cash (less than 10%). Try not to sell for below your equity stake (you can always take it off your taxes ), but get on with your life and leave that part way behind. JMHO.