I have a condo in Palm Desert, CA where my husband and I were going to retire. We also have another primary residence near Riverside.
We bought the condo in 2008 for $363,000 – then the market crashed and it was worth about half that. In 2010, my husband passed away. I managed to pay off the mortgage, and now I’m told it’s worth about $415,000.
However, the taxes are almost $4,000/year and the HOA is $570/month. While I still have a mortgage on my primary residence, I’m wondering if I should sell the condo since it’s now recouped the original sale price, or should I wait and hope it goes up even more?
Although I could rent it, I tried several times and always had terrible renters, which caused me such stress. I don’t know if I should sell it to relieve myself of taxes, HOA fees and stress, or try to rent it again hoping to better screen my tenants? I’m 72, so I’m too old to go back to work.
Skeptical of the sale
“The Big Move” is a MarketWatch column examining the ins and outs of real estate, from navigating the hunt for a new home to applying for a mortgage.
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I am truly sorry for your loss and would like to congratulate you on handling a difficult financial situation following the death of your husband. That’s no small feat, so I hope you can congratulate yourself on what you’ve been able to accomplish.
From your letter, it is clear to me that this choice is emotional for you. You bought this condo envisioning a long and peaceful retirement with the love of your life. And then that future was stolen from you. Guess you never moved into the condo, even after you retired, because it was too bittersweet. At the same time, I’m sure it’s hard to part with something you and your husband bought together. Doing that would be another acknowledgment that he is gone.
You may have already realized this, but if you haven’t, you may want to consider talking to a therapist or confidant about your loss and grief before making any concrete decisions about this. what to do with the apartment. If your emotions are what’s holding you back, addressing them will be helpful.
That said, I want to answer your question, which boils down to whether you should sell now or wait. As Rick Brooks, co-owner of Blankinship & Foster, a wealth management advisory firm in Solana Beach, Calif., told me last year: “Timing the housing market is almost as difficult as timing the stock market. And as he pointed out, the cost of buying or selling a house is much higher than the cost of buying or selling a stock.
Right now we’re in a seller’s market, and have been for some time. There is a housing shortage across the country, affecting both home buyers and sellers. This shortage is going nowhere, and most economists expect it to continue to support house prices even as mortgage rates rise.
““Timing the housing market is almost as difficult as timing the stock market. »”
But rising interest rates could reduce demand for home purchases, as higher rates drive up the cost of buying a home for families across the country. Most economists expect rising mortgage rates to temper home price growth in the months ahead. This does not mean that house prices will fall, but they will simply rise more slowly, according to most projections.
Since the risk of falling house prices still seems low, you have time to think about your options. When you’re thinking of selling now or waiting, you have to ask yourself what you would do with the money you make from selling the house.
If the proceeds from the sale can pay off your mortgage on the home you live in, you’ll free up a big chunk of your monthly income by eliminating monthly loan payments and HOA fees all at once. You might even have some money left over that you could invest to offset other costs, such as long-term medical care, or for vacations and hobbies.
If you decide to sell, I hope you can commit to looking ahead. Playing the game of regret and repeating what you should and what you could have does no one any good. I’m not saying take the money and run away, but I’m sure your late husband wouldn’t want you to fall prey to doubts about something that was meant to be a gift from yourselves to both of you. .
So whenever that day arrives, be grateful for the opportunities it can open up for you – and avoid checking the latest property value on Zillow afterwards. Good luck with your decision.