polksalet Posted July 2, 2011 Share Posted July 2, 2011 (edited) We are hopefully about to start construction on my metal house. I currently live in a spacious 1100 sq 3/2 in a subdivision. Our subdivision is in arguably the most appealing school district in the area and houses like this in the area don't last in the market more than a week or so.The house payment is about 700 hundred and I could rent it pretty easy for 900.I currently owe 70ish and its worth about 85ish. I have 24 years left at 6.7%. I never did the refi because I figured we would sell. With a lot of people talking about big time inflation in the near future I wonder if I wouldn't be better off slumlording for a few years and letting this place appreciate. Thoughts? Edited July 2, 2011 by polksalet Quote Link to comment Share on other sites More sharing options...
moneymakers Posted July 2, 2011 Share Posted July 2, 2011 Rent it out and than vote republican to lower the capital gains tax. Quote Link to comment Share on other sites More sharing options...
Big Country Posted July 3, 2011 Share Posted July 3, 2011 I say either refinance into a new 30-year fixed, which if you can get about 5%, is a payment of about $376/month (not including taxes and insurance) or to a 15 year fixed which at about a 4% rate is a payment of $518/month (again, not including taxes and insurance) Once you have done that, rent it out for 900 and enjoy the increased cash flow. Not sure of your full situation and how you are paying for the metal home (cash/financing), but you could apply the extra cash flow towards the principle of either of the properties to get them paid off all the more quickly and increase your cash flow that much more once one is paid off and apply to the other loan until both properties are paid in full and you have an extra $900-1K coming in monthly. Quote Link to comment Share on other sites More sharing options...
polksalet Posted July 3, 2011 Author Share Posted July 3, 2011 let me add I'm considering closing in my 400 sq ft carport. The would hopefully add another 10-15 to the value. I owe 20 on my land so I should owe a dab over 60 when the metal house is complete Quote Link to comment Share on other sites More sharing options...
wiegie Posted July 3, 2011 Share Posted July 3, 2011 With a lot of people talking about big time inflation in the near future I wonder if I wouldn't be better off slumlording for a few years and letting this place appreciate. Thoughts? A lot of people are likely to be wrong. I see really no reason to expect that housing prices are going to rebound (at least nationwide) anytime soon. You're a Dave Ramsey fan, so let me ask his question to you concerning holding it and renting it: If you didn't already own the home, would you go out and buy it so that you could rent it out. If the answer is not "yes" then just sell the house when you are ready to move (which hopefully will be sooner rather than later, because 6.7% is brutal). Quote Link to comment Share on other sites More sharing options...
polksalet Posted July 3, 2011 Author Share Posted July 3, 2011 A lot of people are likely to be wrong. I see really no reason to expect that housing prices are going to rebound (at least nationwide) anytime soon. You're a Dave Ramsey fan, so let me ask his question to you concerning holding it and renting it: If you didn't already own the home, would you go out and buy it so that you could rent it out. If the answer is not "yes" then just sell the house when you are ready to move (which hopefully will be sooner rather than later, because 6.7% is brutal). I've never made it a main goal of mine to own rent houses. But I recognize it is a valid investment vehicle. If I were to buy and house in the world it would be this one because it is in such a good area and is in such good shape. We also plan on living here for the duration and its only about 8 minutes from the new crib so I could take care of it pretty easily. It looks like I could refi for 10 years and rent would pay the note.I t would give me a hopefully 100k house with a grand a month in income. I could buy another along the way and have a couple grand. That's about what it would take to get me by in retirement. Quote Link to comment Share on other sites More sharing options...
Avernus Posted July 3, 2011 Share Posted July 3, 2011 I say either refinance into a new 30-year fixed, which if you can get about 5%, is a payment of about $376/month (not including taxes and insurance) or to a 15 year fixed which at about a 4% rate is a payment of $518/month (again, not including taxes and insurance) Once you have done that, rent it out for 900 and enjoy the increased cash flow. Not sure of your full situation and how you are paying for the metal home (cash/financing), but you could apply the extra cash flow towards the principle of either of the properties to get them paid off all the more quickly and increase your cash flow that much more once one is paid off and apply to the other loan until both properties are paid in full and you have an extra $900-1K coming in monthly. winner-winner chicken dinner....I wouldn't buy or sell a home right now, if you are in the position to rent and would have no problem finding a good tenant, then rent it and forget it... Quote Link to comment Share on other sites More sharing options...
Big Country Posted July 3, 2011 Share Posted July 3, 2011 I've never made it a main goal of mine to own rent houses. But I recognize it is a valid investment vehicle. If I were to buy and house in the world it would be this one because it is in such a good area and is in such good shape. We also plan on living here for the duration and its only about 8 minutes from the new crib so I could take care of it pretty easily. It looks like I could refi for 10 years and rent would pay the note.I t would give me a hopefully 100k house with a grand a month in income. I could buy another along the way and have a couple grand. That's about what it would take to get me by in retirement. If renting, careful about going too short term on the loan unless you can very comfortably afford the loan payment for several months if you have no tenant or a tenant that stops paying. With a longer duration loan, you can always pay extra towards principal if you wish to pay it off faster, but only be on the hook for a lot less in months you don't collect rent Quote Link to comment Share on other sites More sharing options...
polksalet Posted July 3, 2011 Author Share Posted July 3, 2011 A lot of people are likely to be wrong. I see really no reason to expect that housing prices are going to rebound (at least nationwide) anytime soon. You're a Dave Ramsey fan, so let me ask his question to you concerning holding it and renting it: If you didn't already own the home, would you go out and buy it so that you could rent it out. If the answer is not "yes" then just sell the house when you are ready to move (which hopefully will be sooner rather than later, because 6.7% is brutal). tell me in as much detail as you would like what you think about housing futures. Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.