To sell or not to sell my house
This is sort of a re-posting of sorts. I originally asked this question in another forum here as well as attached it to my posting asking what to do with the cash if I sell my home….
Should I sell my Town House?
The real question is deeper than what to do with the money – Its a great townhouse in New York City and I have spent the last 12 years completely gut renovating it. The house is really the nicest place that I could ever imagine living and I am very close to my neighbors and really love the neighborhood.
I owe less than 400k on the house at a fixed rate of 5.25%, I have a tenant that pays most of the mortgage and my wife and I get to live in a triplex apartment for about 600$ a month including taxes and utilities.
Am I so stupid to believe that this house will hold its value or just drop slightly and that NY real estate will not collapse like the rest of the world? The house was listed for 3.1 million and I have a real offer of 2.75.
Where can I go – I love this city and this neighborhood?
If you have the thought "will the value of my house drop?" then you better sell it now because odds are the price will be dropping.The economy is in for a very rough ride for a very long time. That much is sure. We haven’t seen the worst yet.
On the other hand, if you can pay it off and if you are happy to live there for a long time regardless of the value of the house, then consider keeping it. But don’t keep it because you think it will hold its value.
i responded to you the last time.
i dont think ny is the place to be. i heard today that 165,000 jobs are expected to be lost in the next 6 months. real estate is going to drop. the city you live in is the city i was born and raised in. i love ny but there are much nicer places in the country to be for a lot less. i think the overall atmosphere in ny could turn very ugly pretty quickly. when the tax base starts to drop services will decrease. but hey there is always the new yankee stadium.
Yankee stadium alone may sink this City! You are right about other places to live, I am just looking for an answer that will fit my desire of staying in this house. Deep down I know we are screwed, I guess the question is how screwed?
If I dont sell and stay for five more years and the price has dropped 50% then I will be devastated, but if the price has dropped 20 % or so then at least I have gotten a great place to live for 5 years and only burned up equity that I would have spent on rent.
I agree with the general premise that cities may not be the best places to live when the real collapse is upon us but consider my theory for a moment -What if the cities are not going to collapse ( at least not in this round of financial chaos) and consider that city’s in the near future will become way more populated because the SUBURBS have collapsed and the McMansion owning SUV driving crowd are all without a means to support their oil habit. In cities you still have an economy, services, housing and transport -all things that will need work and if we were smart building up this infrastructure will create jobs and generate revenue
Expecting a "real collapse" where city life becomes deteriorates into a state of lawlessness and destitution is really not realistic. See "Remember Y2K" here in this forum.
Your theory (cities are not going to collapse) has a much greater chance of being the correct view. However, that doesn’t mean you won’t potentially lose 50% of your current equity.
Recognize that you could lose 50% of your equity while life in the city goes on without missing a beat. But don’t allow your emotions to cloud your thinking. Remember, the most extreme views are almost never correct. A "real collapse", as defined above, it such a low probability event that basing a multi-million dollar decision on it is kinda dumb.
Think about this. If your happiness depends on whether the price of your house does or doesn’t drop more than 20%, then may I recommend that you go read about HeartMath or learn Serene Impulse or read A New Earth or do anything that helps you gain a higher perspective. Then allow your heart’s intelligence (not fear) to guide your decision. Peace doesn’t come from $1 million in the bank.
Maybe this financial crisis will help teach more us how to have real peace right now in the midst of any situation. (The links I provided above are a good start.)
Best wishes to you. Consider your problem to be a "good problem".
times are tough and it is hard to know what to do. i left ny in 71 and still have family on the island. my sister is 70 and paying 21k on property taxes and looking at a 7% increase. fortunately the house is paid off. whatever you decide will be the right decision. the consequences will be pleasant or unpleasant but that is your karma and you cant escape it. i think comparisons to y2k are not appropriate.
it is different this time we are 8 trillion more in debt we are in hock to china, the dollar might just be toasted as the worlds reserve currency, we are at peak oil etc.
cities like ny are particularly vulnerable to massive disturbances of services. i was there for the blackout, the transit strike the sanitation strike etc. i survived but i wish to do more than survive. i live in a place where i never lock my house i never lock my car. i am not suggesting everyone move to the country but if the food trucks dont show up in ny you have 3-5 days worth of food. so a place where you are closer to food production is not a bad idea. i suggest a quick read of kuntslers the long emergency. it is on chris’s essential book list. as mentioned in a previous post the suburbs could collapse and a bunch of folks could want to move to the city. what would that look like? it is all speculation but personally i think your options will be much more limited in the future.
in ny you can walk to the stores the culture is amazing i grew up playing in central park. it sure has a lot going for it.
.quality of life is a subjective issue. you have to make your own decision and live with it. for me my lack of stress around safety, my sense of community here, my ability to have a good supply of good food and water. i am close to the university so i get to see plays, dance, music. i can be in national forest in 20 minutes. i can canoe some of the best rivers and sail some of the best lakes in the u.s. .
yet i have friends who will die in ny. so i understand your dilemma. truly i wish you all the best and remember no matter where you go there you are.
Thanks Joe and to all who have responded,
Acting out of fear never works and I have to step back for a moment and take a deep breath – its not the worst situation to be in, to walk away with 1.8 million or to stay and have a great place to live in and finally enjoy after 10 years of labor.
For now the deal is off, buyer is a bit of a wreck and has little melt downs along the way – the latest being that she wants the for sale sign removed from the front of the house, i wont do that without a contract and an agreed upon final sale price. It may blow up or it may blow over we shall see. But for now I choose to do nothing,
Life is not about money for me and that is never where I have found happiness, I just have to let it all go and see where it leads me.
Thanks to all for your input.
Currently I have a house for sale and a large piece of land that I’m developing (small farm). Selling now, or more appropriately having for sale any real estate could potentially be a great buy for anybody. If you’re planning to purchase something smaller, or at least more sustainable as I’m looking to do, consider this: Real estate is relatively low in price right now, but so are the financing rates. The future will bring a continued lowering of real estate values, but the rates to borrow for those properties will potentially be in the double digits (remember mid – late 1980’s ‘teens rates?). So, while some may wait for the bottom to completely fall out, by the time that happens nobody will be able to afford to borrow to get it. Right now, people seem afraid to get a mortgage. I have flyers that get picked up, hits on multiple websites, but my friends at the banks tell me that nobody even asks about borrowing right now. I’m confident that once people "Feel" O.K. about the system (and they will get ‘used to’ things as they are), the place will go.
Now that said, if you’re wanting to sell for the sake of selling thinking to maximize profit – forget it and stay put. Unless you’re moving for a sustainable, long-term reason, you will waist time, and ultimately your money.
I also answered before and thought a place where you had built community, a place where you could essentially live for free, a place where you had built a life and loved was an excellent place to be. What possible deal would be better than that? It made no sense to me that you were considering selling it in a vaccum. Where would you move? What would it cost you? How long would it take you to get to know your neighbors, to build up garden beds, to own the place outright? I think it’s impossible to answer this question without knowing what you’re considering doing next.
You are right – I could not duplicate my living situation anywhere – at least not without 12 years of hard work and then there is no guarantee of happiness. Its like starting over in a new relationship the task is daunting and the reality is your old one may be pretty damn good.
If I did sell I would stay in the city for a few more years, work and save as much as I could, taking a vacation or two would also be on the agenda My friend has a farm in Massachusetts that I am familiar with and I have family near by, there may also be the chance to buy up some adjoining acreage if the price is right. As far as sustainability that is all I can think about now, I want to build a passive house and be completely self sufficient – I can do it – the last 5 years of my life have been focused on as close to zero energy homes as we can get to – none of that criminal LEED"S shit or politicized "green" housing but real housing with NO central heating system – its easy to do , Germans have been doing it for years – but don’t tell the oil companies.