Husband & I bought a home in DC suburbs Apr 2021. Buyer’s remorse because my job became indefinitely remote making it hard to build a social life here - 1/2 our friends moved away in last 1.5 years. Thinking of moving to PA in 1-3 years where we have friends & family. Do you recommend renting out our home? Or sell it for nest egg after 2 yr mark to avoid capital gains tax & potentially just before the real estate peak (maybe 2025 if 18 year cycle+2007)? Husband wants to rent it, I want to sell.

like
Posting as :
works at
You are currently posting as works at

$500K in home sale profits are tax free for married filing jointly every 5 years if I recall. Recommend not waiting for 6-8 more Fed rate increases to push home prices down when mortgages become more expensive.

likesmart

I think if you are unhappy and can relatively painlessly sell (emotionally and financially), you should seriously consider it. Make sure you have a landing spot on the other side though!

like

If you rent it out, you compromise the ability to exclude capital gains from being taxable.

Moreover, renting can be a gamble in the sense that you could get the perfect tenants who pay on time and take care of the house as you would; or anything short of that (like, for example, someone who expects the landlord to change a lightbulb).

The expected return on renting has to be fairly strong for me to compensate for the extra work that I wouldn't necessarily factor in as as a quantifiable cost. Easily quantifiable costs being things like property taxes, additional income taxes, maintenance/upkeep, professional management fees (if applicable). Not-so-easily-quantifiable 'extra work' being finding a tenant, replacing a tenant, record keeping, dealing with tenant requests...

like

Great take SD! To build upon it, if mortgage rates rise and your home value falls in the future, it would likely have been worth it to keep 60-70% of the upside (net of short term cap gains tax and realtor fees) and not deal with the headaches SD listed. If you want realty income, look into REITs.

You could also rent in PA and look for a new place to buy in person instead of doing it from afar.

likehelpful

Purchased for $390K, 10% down, 3.12% interest rate on 30 year mortgage. Home values have continued to rise - various real estate website estimate now valued $380K-$450K. Most homes in neighborhood now selling for $410-$415K. Seems like things are still on the up swing.

like

Honestly, I would sell. I had to make this decision with a condo I owned when I was moving out of the state it was in. Everyone said no, keep it and rent it, but I sold it, and I'm glad I did. You never know what will happen, and if you're the landlord, whether you live down the street or several hours away in another state, you are responsible for dealing with problems regardless of how hard it is - 6 months after I sold, the pandemic started. Even if there had been a problem (like if something broke), I wouldn't have been able to go deal with it, and it's possible the person could have lost their job or just stopped paying rent, and I wouldn't have been able to do anything. I'm SO glad I didn't have the extra worry about my condo this whole time, and I'm glad I had the cash to buy a new home in 2020 before the housing market went crazy.

like

Thank you, All! My husband feels like renting it would be a “good investment” but I’ve been anxious about the challenges/risks you’ve outlined. Maybe I need to make a better pitch for how we make money elsewhere, if we go with the sell option!

like

I would rent it out. Pay property mgmt company if you want to reduce headaches.
Run the numbers but I think it would work out.

Alternatively, sell to reap gains exemption, then invest in real estate differently, like Fundrise or REIT

like

How much would it rent for?

If you think it would rent at a positive cashflow, I think you can expect some continued strong appreciation for another 3 to 5 years, which could greatly benefit you.

You mentioned you only put 10% down - were you able to get rid of PMI already? If so, you may want to try to pursue that first. If that requires a refi (depending on the rules of your current servicer), that may play into the cashflow situation.

The other thing to consider is would you need cash from your current property to act as a down payment for the new property? If so, that can play into the decision to sell, or at the very least, it can affect the cashflow calculation if you need to do a cashout refi and/or a HELOC to unlock that dead equity.

Lots of variables that play into this decision.

Related Posts

I am from India and looking for remote jobs from US/Europe. I have 8yrs of iOS dev experience and total 13yrs of experience in software development. Can anyone here help me by referring to any vacancies? Or are share thoughts on how to proceed on this.

like

Told my gf (26) that I don’t want to buy a house with her because it is more straightforward for both parties if we keep things separate until marriage. We have been dating 2 years and renting together for 1 year.
I (29) suggest she uses her money to buy property separately whilst I’m happy to continue living together, whether it’s at my or her place.
She adamantly refused and cried and says we are buying together and she doesn’t want her own place.
I was calm and reasonable. What do I do?

like

Thinking about moving and looking for full time remote jobs. What are some jobs that use our skillset and are fully remote?

like

Hi is anyone free for a weekly remote 3 hours daily job as a listing agent for rental property ? Experienced or not we have salary bases for both experience and none experience person’s . From 550 weekly. Send a DM if interested for more details.

likefunny

I recently joined citi. I have been given choice for to select superannuation as 13% of BS or 12500/- monthly or zero.

This is one time selection and not reversible.

I am already investing 1.5 lakh in 80C through SIP and EPF.

I need more detail about superannuation and is it beneficial or not?

Also is there any retirement age in IT field 🤔 (or in citi)?

Hey guys, I am CA having post qualification experience of 2.5 years. My last one year experience has been with Deloitte USI as an audit senior associate. I am looking for work from home options. Preferred working areas are audit and direct taxation. Can anyone help.

Anyone open a 529 before children are born? We’re not planning to have children just yet, but wondering if it makes sense from a tax perspective

likehelpful

Any ideas to make extra money?

like

I’m looking for remote jobs in Canada but it looks like almost all jobs are either in person or hybrid. Does anyone know which companies are completely remote in Canada?

like

What is a good read (book) for options trading? I know a fair amount already but I would like to read up on more advanced option strategies and terminology

like

What’s a good argument against getting rid of cost of living adjustments for remote workers?

If two people have the same job/salary, but one is in NYC and the other is in a much cheaper COL location, what’s the argument against lowering the remote workers salary?

like

If I'm on H1B, am I considered as resident for tax purposes without calculation? (2015 F1 Student, 2016-17-18 F1 OPT, since October 18 I'm on H1B) I'm super confused 😣

like

How do you guys invest on gold? Is it just buying the biscuit or do you invest in their stock/ETF?

like

Anyone work in an office with an open floor plan? Just got an offer to join an asset manager ($30bn AUM) as their second funds lawyer. currently a 6th year. nervous if I can cut it, if the open floor plan makes sense, if I can withstand 2-3 days in the office when im 100% remote at a v10. I have 3 little kids. first time in house. Any tips? thoughts?

likehelpfulfunny

Considering leasing a place on the beach for a few months since WFH isn’t ending. Not seeing any good choices on Airbnb. Anyone have other suggestions of places to look?

like

Hey FishBowl Friends, so I’m currently trying to break into tech sales/FinTech and I feel that due to my previous work history, I might not look like the ideal candidate on paper but I’m an extremely fast learner and very coachable. I’ve been a manger at a gym, got my degree in finance, worked as a client advisor at a top 3 auto dealer in the nation and now I’m a project manager at a solar company. I really want something that’s remote and steady, any recommendations on how to spruce myself up?

like

Does A&M hire people in cities without a FDD practice now things are remote? Or would you be required to move?

like

Down $17k today. 🤮

upliftinglike

Thoughts?
I’ve been working at my current company for 11 years, for the past year I have been waiting for a promised promotion. I have been fully remote for 7 years pretty much good work life. Busy. In April they said I have the job still waiting. I am a project accountant III to a finance business manager.Could be long nights &stress. Still unknown pay maybe 20k increase.. Last week I was offered a govt job at NGA (Budget analyst) 40k increase not guaranteed remote. 45 min drive +retirement

like

More Posts

Has anyone got successful to change status from B2 pending to H1B ??

like

Any ideas to schedule thanksgiving week? I have 15 contractors and a schedule Monday-Saturday for them. (I would like to give them the 40 hours, If it is possible)

like

Please can anyone recommend a good instructor in coursera or udemy for PMP?

like

Who is responsible to make the sales playbook? VP of sales, Director of sales, Head of Sales or Sales enablement?

like

I am a fp&a manager at Dufry Group making 120k P.a. is it good enough for this position? Or should I look for better opportunities?

like

I need to create a user research and testing plan for my company. Anyone have any suggestions or preferences for paid platforms that you have used? Thx!

like

Are any L&E groups/firms hiring judicial law clerks for Fall 2023 yet (junior level - 2nd/3rd year)? Primarily interested in counseling but wouldn’t oppose some split with litigation. Any insight is appreciated!

like

Hello..

Plz suggest best institutes or organisation for doing HR analytics course....

like

DM me if you need a referral at JPMC

like

Almost every place this month.

Post Photo
funnylike

Can one take leave during notice period?

like

Hi everyone! I’m looking for motivated individuals that are interested in earning extra money in the financial services industry. We offer schedule flexibility, free training, high compensation, and help paying for licensing. If you’re interested you can dm me or drop a message in the comments.

like

How much a Team Lead n Line cook make at Cheddar's?

Any more lay offs?

Even if you do get followers on TikTok, they don't have much money to spend on your product or service—and they're likely not going to stick around long enough to do so anyway.

like

I am selected as a Python Developer in Acuity.
Please brief me about your experience in working with Cians Analytics (Acuity), Like how it is to be working with this company, work culture, career growth, work from home policy etc.
Considering this layoff season, shall this opportunity?
Any suggestions or advice will also be appreciated.

5.5bn .... 🤔🤔PWC...

like

Ericsson R&D vs BMC software vs NASDAQ Which company is better to join. All of them are paying more or less the same in-hand salary. YOE 3.2 years Skills java + MySQL


Ericsson BMC Software Nasdaq

like

Do many Googlers have visible tattoos? Are they generally accepted? Heaven heard it’s no issue in tech but just want to check

like

How are you guys? Need any help in any topic? ping here.

Additional Posts in FIRE Financial Independence Retire Early

I have nearly half my net worth in traditional 401k... If I want to retire early at say 40-45, is there any way to get access to the funds early? (I was "late" to the FIRE movement and found out about Roth IRA too late aka after I earned above the income limit)

like

I’ve been listening to “millionaires unveiled” (highly recommend for FIRE content) and it seems like every other guest ends up doing real estate investing. If you do it, what books or online courses would you recommend to get started? If you have experience in real estate investing, would you ultimately recommend it?

like

I have 70K in student debt, what’s the fastest way to pay this off? I’ve moved in with my parents to cut off food and rent expenses to start

like

When is a property too old to be worth renting out, given the potential hassle and unexpected expenses?

like

Had to switch my ejector pump in the basement last night. No major damage as we luckily caught it on time, but it still cost $1350 for a plumber to come in and swap pumps. Is it worth filing insurance? My deductible is $1k so I'll only be getting around $350 back. Will premium go up in future even though the risk of this happening again is really low with a new pump? Policy is with Lemonade.

like

This may be a stupid question but how do people FIRE mainly with retirement accounts and why is there so much focus on maxing these accounts when you can't access them until you're in your 60s?

like

What do you do if you bought an investment property in an area you thought would develop but looking like it won't and you'll lose money? Sell and take the loss as soon as possible? Rent it out and wait for a better time?

like

Term life insurance question - I added the AICPA annual term policy last year. I've noticed personal finance media seems to push 10-20 year term and not discuss annual.

It was considerable cheaper up front and more at the end than 10yr per the fee schedule. If all goes according to plan I'll be at or close to FI within 5-7 years so not sure that I'd keep the full amount past then and would miss the benefit of the cheaper years at the end. Am I missing other risks of not doing 10+ term?

like

Do you maximize your after-tax contributions up to the ~$57,000?

Why or why not?

I've read a few MadFientist and Financial Samurai articles on it but haven't yet contributed myself. Curious what strategies you use to max tax sheltered income while planning for early retirement

like

Best app / company to create a Roth IRA account? Looking for low fees and not much maintenance

Is buying a home early a smart investment decision?

I’m 21 and grew up in a poor family so I’ve always been extremely aware and conscious about money. I need all the financial advice I can get!

like

In my HSA I am holding 4% in ARKG and 4% in PBW (clean energy index). Both are down 50%... looking to consolidate my funds, so I am considering selling them both and allocating the 8% into something like XT? I understand I made those purchases in times of extreme optimism, so that is an F on my part.

My other funds in there are 64% VTI, 16% VXUS, 5% VWO and 7% EMQQ.

Looking to buy, hold, and DCA. Would you swap ARKG/PBW for something like XT?

like

How do you measure fire readiness when it Comes to real estate ?

My current + pipeline homes (2-3) year stats:
Purchase (10 homes) 4.3M
Down- about 25%
Market value- guess if 5.4M
Equity of 2.1M , net equity of 1.0 if exclude my down payments
Cash on cash isn’t best but about 4.5% ( lived in some of these homes)
Net income- 50k/yr

Clearly high assets and loans with small cash compared to current income but building wealth. How to measure fire - income? Wealth accumulation?

like