Should I sell my house?

I’ve owned rental properties for almost a decade. Next time I get a late night repair call will be the first. This concern is highly exaggerated. You can also hire a PM if you’d like to avoid repairs calls.

I don’t find renters, my agents does. I set the parameters and they find them. If you have a good asset, you will have no issues finding renters.

Yes, fixing issues after turnover can be a hassle. Dealing with that now. Again, you can always hire a PM if you choose to.

Tax implications? More like tax advantages. I get to ‘depreciate’ assets that appreciate significantly. All repairs are tax deductible, major repairs I can add to the basis and depreciate. And if ever want to sell I can do a like for like exchange.

Being a landlord can be a hassle. Which is why you need to pick a strategy and stick with it. I only buy decent places where decent people will want live. I pass on potential tenants that don’t meet my credit, job history, salary requirements even if it means my property is vacant for a while longer. And I try to inspect often. I still get burned, but it’s rare. I could make more cash flow being a slum lord, but the real money in real estate investment is the appreciation.

 

Well I don't necessarily disagree with ur experiences.
However we were a landlord for a lot longer than 10 years and more than once got a call at an inopportune time. Never said it was common, but it happens. Sure u can get a property manager (again due diligence) but there goes a chunk of ur profits.

As for taxes, sure there are adv, but u have to know them or at least have an accountant to explain them/deal with them. It was my impression that this was a one time deal for the OP not a l/t biz decision like yours, hence my comments.

 

I don't think anyone else has mentioned this, so I'll give it a try. If you have a house that you bought for about $115k and sell it for $190k, and you don't buy another house (within a year?), then the difference between the sales price (minus the closing costs, presumably) and the purchase price is considered profit, which is considered income. You'll have to pay taxes on the $75k, or about $60k after closing costs. I think you are allowed to scale down your house value one time during your lifetime without paying taxes (?), but you may not want this to be the time to do that. I do know that if you buy an equally-priced house or a more-expensive one, there is no additional income tax to worry about. I'm not a tax accountant, so you may want to consult with one before you decide.

 

If he sells it as his primary he is fine.

Tax Aspects of Home Ownership: Selling a Home - TurboTax Tax Tips & Videos

 

There are also a lot of bad property managers out there. We had a neighbor that rented through a property manager, and had the property manager arrange to get things fixed when there were problems (since they were living out of town). They eventually found out that the manager and his friends were fixing things themselves (without knowing how to do it) and billing them for the shoddy work under the friends' made-up companies. The whole neighborhood found out about it, because the garage door wouldn't stay on its tracks, and these dimwits were just forcing it back on the tracks without correcting the positioning of the tracks (so it happened again the next time a person used the garage door). The garage door stayed halfway open (and cocked sideways) for a year. And they charged several hundred dollars for all of their "fixes".

 

It’s not one-time. As long as it is your primary residence for 2 of the last 5 years you can exempt up to $250,000 as a single filer.

I used to know a home builder that moved into a new home he built every two years to take advantage of this rule.

 

Little known fact, even if you sell under 2 years, you can get an exemption for unpredictable situations. For example having a kid and needing more space.

 

True, there are exceptions and I think they prorated for how long you held your house compared to the 24 month requirement. I wasn't aware of the kid exception.

 

It’s an exception for unpredictable events, but there’s precedent for having a kid. Basically something that forced a move that couldn’t have been predicted. And it’s a full exception. I’m pretty sure working from home due to covid would have qualified as well. But we’ll have to wait until the audit periods are over.