I've been trying to sell my house for a while and I'm actually renting elsewhere now, closer to my job, during the week. The house is priced where the real estate agent recommended and we have lowered the price several times. If I go any lower it'll be less than we paid for it, but I still have room to reduce the price and payoff the mortgage. Which is financially better? Hold out for what we think is a fair price--and keep paying the mortgage and property taxes, etc.? Or set a firesale price and get rid of it as quickly as possible?
asked Nov 14, 2017 at 1:12
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1Presumably it is sitting empty? If so, how much is it stressing your budget (limiting your ability to save, or even requiring you to not pay off your CC)?– RonJohnNov 14, 2017 at 1:18
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The typical real estate cycle has prices bottoming out around this time of year and remaining low until the spring. Having already cut price a number of times is not a great sign. I'd stop the bleeding, personally.– Hart CONov 14, 2017 at 1:40
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can you rent it out?– KevinNov 14, 2017 at 2:05
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Thankfully this isn't stressing our budget but every payment on the house is money that could've been invested somewhere. So I guess the question is whether we cut our losses now or hope that waiting X more months will get us a price that will cover what we pay in the meantime.– WebUserLearnerNov 14, 2017 at 2:07
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1How much of a discount do you think you'd need to sell it immediately and how much does that compare to your annual costs to maintain and pay taxes on the house? (the mortgage payment is mostly inconsequential to the equation).– JohnFx ♦Nov 14, 2017 at 3:21
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1 Answer
Which is financially better? Hold out for what we think is a fair price--and keep paying the mortgage and property taxes, etc.? Or set a firesale price and get rid of it as quickly as possible?
This is opinion based. The factors you should consider and arrive at is;
The current cost of holding the property for 6 months, 1 year, 2 year etc. This should include taxes, maintenance, interest on mortgage, etc.
Estimate the potential sale value after 6 months, 1 year, 2 year etc. This is difficult. You can refer to various trends, but there is no sure shot way to determine this.
Once you do it is easy to determine if holding out makes sense, i.e. if the costs are around 10K and potential gain you think is around 10K; not worth it; if it is around 50K yes.
