Sell Or Rent Out My Small House
February 11, 2010 9:05 AM   Subscribe

I Can't Decide: I have 24 hours to decide whether to sell my a very small house in a very small town or to rent it out. I am 1200 miles away but had planned to return and have some fun with my friends then rent it out and come back down here. However, a realtor called and said there are people who would buy it with cash and no inspections (it would never pass conventional inspection) at nice profit.

Do I take the money and forget about a fun summer with friends or do I put some money in it (it needs a new furnace) and try to rent it out o good renter. My kids say keep it (they like the thought that whatever happens there will be a roof for them). We are only talking a small amount of money and its paid for. Thanks
posted by Mickelstiff to Work & Money (23 answers total)
 
Can you sell it and use some of the money to return in the summer and rent a place yourself?

How much do you feel like dealing with fixing it up for a renter?
posted by odayoday at 9:08 AM on February 11, 2010


My opinion is that someone that puts a 24 hour deadline and pressure you into making a quick decision like that is trying to screw you.
posted by MegoSteve at 9:09 AM on February 11, 2010 [11 favorites]


Exactly what MegoSteve said. Did you know the realtor before they called? Can you talk to anyone local to find out more info?
posted by infinitefloatingbrains at 9:19 AM on February 11, 2010


Response by poster: The 24 hour thing is a time limit I imposed on myself. This has been going on for a week and said no a couple of days ago and then brought it up to the realtor again. We tried to sell last summer before I moved but it didn't pass inspections due to septic field and some electrical issues.
The same person brought it back up a week ago and said they would forgo any inspections and pay with cash.
I had planned to go back for an extented visit to live for a while and see if I could find work since I havent had luck down here. I am living on a pension so I can survive OK.
I had my bike shipped up and even bought a bed in preparation, but I have to admit the ease of just taking the money and foregtting about the worries is enticing.
posted by Mickelstiff at 9:25 AM on February 11, 2010


It could work where is this house? what state? That matters a lot.
posted by majortom1981 at 9:29 AM on February 11, 2010


If you rent it, how are you going to handle maintenance on it while you're in a different location? How easy will it be for you to find tenants, and are you sure you can trust them not to destroy your place, particularly if you can't just drop by and check it out easily? If it won't pass inspection for a sale, I'd think there will be a lot of issues that a tenant would need fixed. Will the rent cover the cost of maintenance and management and....

I'm a bird in the hand kind of person. If I was happy with the offered price, I'd be inclined to take it and be done with it. That's me though. You're the only one who can really answer the question for you.
posted by willnot at 9:56 AM on February 11, 2010


My advice is to decline to sell the property now unless you really need or want the money now, or really need to sell it sooner rather than later. If you're getting interest now, you'll probably get interest in the future. To be clear, though, if this place wasn't paid off, or was a serious drain on your finances, then that would completely change things. But it sounds like it's paid for, you have enough to live on, and you were looking forward to using the place this summer. So my advice is to try selling again after next summer. Maybe it'll sell in weeks, maybe it will take many months, but if you have the time and money to wait it out, then no worries, right? Also, if you know you're going to sell it in the future, you can mention this and the timeframe to the prospective buyers, who knows, maybe they'll still be interested?
posted by forforf at 9:56 AM on February 11, 2010


Ask for more cash. If they're willing to buy it without an inspection, for cash, they know something you don't. If you do decide to sell, ask for more first. Like 25% more in order to get 10-15%
posted by citystalk at 9:56 AM on February 11, 2010


My first impulse was to say to sell it if you can in this climate.

My second is the same as citystalk's. Why are they willing to buy at all? In cash? Without and inspection?

They don't want the house, unless it's got a copy of the Declaration of Independence behind the wallpaper. Do you have mineral rights? See if there's drilling or anything going on around there, or a mall buying up property or something.
posted by cmoj at 10:01 AM on February 11, 2010 [1 favorite]


Think about it this way. If you had the cash in the bank and the realtor called you and asked if you would like to buy this house tomorrow, would you do it? If you decide that you wouldn't buy the house if you didn't already own it, then you should sell.

Since you are in the position of getting cash for the house today, keeping it is the same as if you were making the decision to buy that house for cash tomorrow.
posted by JackFlash at 10:01 AM on February 11, 2010


I know way more people who regret not selling their houses in the past couple years than people (like me) who took a good offer and sold.

An alternative would be to delay the closing until late summer if the buyers are willing. Of course, that gives them more time to listen to people say: "No inspection! Are you crazy?"
posted by Elsie at 10:08 AM on February 11, 2010


JackFlash's suggested perspective shift is a good one, and also consider: the house isn't a great one (or it would pass inspection) so you're choosing between making a known, real profit in cash and holding onto the house for theoretical benefits later.
posted by davejay at 10:46 AM on February 11, 2010


(and those theoretical benefits presume further investment to fix it up, increasing your potential loss)
posted by davejay at 10:47 AM on February 11, 2010


1) Cash
2) No Inspection
3) Profit!

In this market and economy? Take the money and run.
posted by trinity8-director at 11:04 AM on February 11, 2010


To counteract the worry that the potential buyers know something you don't about your property, do you know why they're so interested?
posted by amtho at 11:39 AM on February 11, 2010


Based on what you say, I'd say sell it. But you know the details I don't, so bviously it's your call, but from my past experience I offer this:

Do you have much experience with rental properties and the hassle/issues that can come from them?

If you do, then you can go with your instinct.

If not, imagine what you think the hassle of being a landlord might be, and then multiply that by about 12. That's closer to what a pain it can be.

Then use that figure to weight whether or not you want to rent it or sell it.

Good luck.
posted by MCMikeNamara at 1:09 PM on February 11, 2010


Word of wisdom, from an attorney who is currently representing buyers and sellers of homes in litigation alleging misrepresentation and breaches of warranty/contract. [b]Do whatever you need to do in your jurisdiction to make sure the home is sold "as-is" with the requisite waivers of warranties, representations, promises, whatever.[/b] There is probably a way to do this in your jurisdiction, and it is probably pretty specific with a lot of common law exceptions. You do not want to turn around and be sued when they find out there are foundation issues or electrical issues or plumbing issues or...... And it does happen. A lot. Also, your jurisdiction may have a requirement that you do a seller's disclosure. This is a minefield for you as the disclosures will be called representations later on.

I don't know anything about your case or the applicable law, but I read your question, and I get nervous. I know this gets old, but call a lawyer.
posted by seventyfour at 1:22 PM on February 11, 2010


I had this advice from a guy who had been in the property business for over 40 years: 'Buyers are liers'.
And since then I've had many people say to me: "we are a cash buyer, no need for a mortgage or a survey ..." 99% have turned out to be lying!
posted by euros at 2:08 PM on February 11, 2010


I agree with those who've said it's suspicious that this buyer is willing to forgo an inspection. I'd try to find out why. If it really is on the up-and-up, then yeah, it sounds like selling it now is the way to go.
posted by whitelily at 4:49 PM on February 11, 2010


I'd sell in a heartbeat.
posted by FlamingBore at 4:51 PM on February 11, 2010


To me, 1 in the hand is worth 1.2 in the bush. I'd assign a 20% premium for certainty. So I'd compare --

What they are offering * 1.2

What you think you could get on the open market [minus] what it'd take to fix it up for sale [minus] some consideration for how much of your own time you'd put into it

Really, the main variable is how much you value your own time. It doesn't sound like you're interested in fixing it up for sale, so I'd sell it as is now, unless I suspected that there was some speculative reason to hang onto it (e.g., a new Google campus locating next door).
posted by salvia at 2:09 AM on February 12, 2010


The no-inspection thing makes me wonder if they're going to bulldoze the house or combine lots to build a mall or something.
posted by salvia at 2:10 AM on February 12, 2010


Depending, of course, on the state, no inspection does not automatically mean that the buyer is unable to come back later and make a claim regarding the condition of the home.
posted by seventyfour at 5:51 AM on February 12, 2010


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