Real Estate

Ask a Broker: Rent or sell?

By Peter G. Miller

CTW Features

Question: We're both retiring during the coming year and want to downsize. Does it make sense to sell our current property or keep it as a rental?

Answer: You need to consider the real estate market where the current property is located, alternative financial options, and your personal preferences.

The first issue concerns the financing of your current residence. Does it have a mortgage? If you do not have a mortgage, it means more of any potential rental will go to you and also that if you sell, there will be a bigger check at closing.

A big attraction of selling is that resolves all current house issues. What you get at closing belongs to you and what happens to the house thereafter is the concern of the new owners.

Current federal tax rules generally say you can shelter $250,000 in profits ($500,000 if married and filing jointly) if the property you sell has been occupied for two of the past five years as a main home. If you rent the property for enough time, you can lose this advantage and be exposed to a large tax bill.

A big catch here is that tax reform will get serious consideration in Washington during the new Congress. For details be sure to speak with a tax professional.
Local real estate patterns also will influence your decision. Are local prices and rents generally rising or falling? The National Association of Realtors says in the third quarter of 2016, home values rose in 155 out of 178 metropolitan statistical areas. However, prices also fell in 22 areas. What prices will do in the future is unknown. As they say on Wall Street, past performance does not guarantee future results.

Do you want to hold onto the property and be in the rental business? This is not a casual decision, especially if you are moving out of the area and a pipe leaks. It's best to have a local manager who can oversee the property for you.
If you sell your current home the dollars you get at closing may be enough to finance a replacement property, allowing you to live mortgage free.

If you rent, you will hopefully get a monthly check plus you will have the ability to shelter some of your income because of depreciation. Renting, in the best case, can produce a nice steady income to complement your other retirement funding.

Another choice is to rent the property and refinance. In this way you can get a rental income, financing at today's rates, plus the ability to depreciate the property. The amount you borrow may allow you to buy a replacement property for cash. Speak with lenders and tax professionals for details.

Peter G. Miller is author of "The Common-Sense Mortgage," (Kindle 2016). Have a question? Please write to This email address is being protected from spambots. You need JavaScript enabled to view it..

 

Jason Robie: Bright and bold is bad for buyers

By Jason Robie

If you've been reading the latest scoop in the real estate world, you now know that there's a shortage of homes for buyers to buy. Of course, it goes without saying (although here I am saying it) that that is a national trend and you should really call your local agent to get the local scoop.

That said, we're quickly slipping and sliding our way through the mud towards the spring selling season in real estate. Yes, we talked quite a bit this year about how it is possible (and even advantageous) to sell your home during the winter months. But springtime is when the tire-kickers and serious buyers start to sprout like daisies on the front lawn.

 

Home Front: This is not your mom's laundry room

The laundry room is often treated like dirty clothes, relegated to the basement, housed in a closet or shoved in the corner. Doing laundry isn't considered a glamorous activity, and the space frequently reflects the task. Blah! However, clean clothes are essential, and when the laundry room is clean, bright and well organized, the chore can take on an entire new and positive vibe.

Understand the potential
Keys to effective laundry room spaces are an abundance of storage, places to hang clothes and space for folding. A sink in the laundry space can serve multiple purposes ranging from bathing pets to hand washing delicate garments. Similar to kitchens and bathrooms, open-floor-plan laundry spaces can serve multiple functions that may include mudroom, craft area, exercise room or play room.

Appliance options
There are two main choices for washers and dryers: top-load or front-load. Top-loading appliances are easier to use — simply lift the lid and drop the clothes in. Front-loading requires a little more effort. Typically top-load washers are less costly and run more quickly than front-loading counterparts. Consumer Reports claims that top-load washers also spin faster, which removes more water and thereby reduces dryer time. If you opt for a top-loading machine, be mindful of the depth. For shorter clients, it may literally be a reach to remove clothes. Consumer Reports also claims that the front-loading machines clean better, are gentler and use less water than top-loading machines. The choice really may come down to aesthetics. Which look do you prefer?

Doing more with less
Many laundry spaces are not large. To maximize the space and make it look larger and more functional you might want to consider a stacking washer and dryer. Floor-to-ceiling storage, retractable hanging spaces and cabinets can also increase functionality.

Environmental efficiency
There is a wide range of eco-friendly products that use less water and energy without compromising performance.

If you are interested in transforming your drab laundry room into something truly exceptional, give Country Cabinets a call at (603) 356-5766 or visit the showroom at 95 E. Conway Road in Center Conway.

 

Jason Robie: Move-in mastery

By Jason Robie

It's safe to say that we've all "moved in" about a dozen or more times in our lifetimes. Whether you were a kid moving with your parents or an adult getting your first apartment or buying your first home, moving into a new place is exciting, stressful and filled with anticipation. You would assume after a handful of these experiences, we would be awesome at it. In reality, there are still a few neat tricks we can glean from others' years of experience. Let's see if we can pick up a trick or two to make the move-in experience more pleasing and more fruitful.

One of my favorite parts about working with professional, experienced, local real estate agents is their vast network of vetted service providers. A real estate pro's business is almost exclusively based on networking. You can be sure that a recommended plumber or electrician is going to be top-notch when referred by an agent. They want to be sure you are happy with the worker they've recommended and that you will remember them when it comes time to buy or sell again. Before you grab the keys and wave goodbye at the closing table, get a few solid recommendations from your agent. They'll appreciate your trust in them and you will appreciate not having to pick random goof balls out of the phone book or the internet.