Should we move to Portland? Should we sell or rent our house in LA?
January 7, 2010 11:29 AM Subscribe
Want to move to Portland, totally screwed on selling our house in LA. Need help on deciding whether we should 1. move? 2. sell or rent our house? Apologies for the pretty long explanation.
posted by stewieandthedude to Work & Money (18 answers total) 1 user marked this as a favorite
My wife and I bought our house in LA about 5 years ago. Now, we want to move to Portland, but are a little stuck mentally with whether that is a smart, or at least not insane, thing to do right now.
Here are the house/money facts: We bought our house not at the absolute height of the real estate market, but in hindsight, we certainly overpaid. We paid $440,000, with $100,000 down. We've put about another $40,000 into the house since then (new room, heating/ac, and assorted other expenses). Our realtor, who we trust, told us yesterday that she thought we could maybe sell for $395,000 at best now. With closing costs etc, we estimate we'd get about $35k back (of about $140,000 we've put in). We're not stupid poeple and have definitely come to grips with the fact that we made a bad investment and we're going to lose money, but honestly hope it wouldn't be quite this bad.
We're moving to Portland for several reasons - like a smaller city, want a more bikeable, transitable, walkable city where we can live in the city and still have decent schools. We're also moving because it is more affordable and we can afford a bigger better house that will accomodate our growing family (have a 10 month old son).
In addition to the house investment, we have about another $100k in savings that we've saved up in the last 5 years. Our rough estimate is that the house in the neighborhood in Portland we want would cost about $550k.
Jobwise, I have a pretty well paying job that I can do from anywhere and that I could take with me to Portland. My wife has a well paying job in LA, but so far, no job in Portland. Her prospects are decent, but she may have to take a significant paycut. With our current salary and our current mortgage, we can pay it and save abut $20k/year.
My questions and I'd appreciate your thoughts on any or all of them.
1. Given that we need the two incomes to make the mortgage work, should we move without her having a job?
2. Should we sell the house or try to rent it for a while? We think we can cover our mortgage with the rental income, but probably not taxes and insurance, so we'd be paying out about $400/month, plus we'd have the added hassle of trying to manage the property from afar. On the other hand, the hit we're taking on the house is so big that we're having trouble stomaching it.
3. Another option that we've considered is staying in LA for a while, continuing to save more money, live in the house for a bit longer (we can't stay forever, because it is too small) and then maybe rent for a while in LA while we save and see what happens?
As you can see, we're a bit confused as to what to do. any ad, vice appreciated.