What to do with rental property

**InOverMyHead** · 01-10-2008, 07:16 PM

Well, as the name suggests, I probably got in a little over my head and now its come back to kind of bite me. I currently own some rental property in Florida that does not bring in enough cash flow to cover all of my expenses. Currently, it covers a little over 75% of my expenses. I would love at this point to just get out, re-coup intial investment, and be happy with my experience and the lessons I've learned.

But this market is just terrible. I did some research recently and found that comparable condos (basically, same floor plans, square feet, etc in the same complex) are going for nearly $50k more than what I initially paid for the condo....but there just arent enough buyers!

So I'm at a crossroads. Should I try to price mine down to say $25k below most of those hoping to just get it sold and come out OK? Or do I hold, pay the out-of-pocket expenses each month and hope this market turns around anytime soon?

Boy have I learned some lessons....

**LOTrainer** · 01-10-2008, 08:21 PM

Can you try to get a Realtor to put renters in the property?

**thedeallocator** · 01-11-2008, 01:11 AM

Sell it if you can. Home prices in most parts of FL continue to drop.

**Mike Taylor** · 01-11-2008, 04:04 AM

You said it is currently rented? When is the lease up? Would the tenants be co-operative about showing the home? Maybe the tenants are interested in a lease with option to buy.

**Greg** · 01-11-2008, 04:52 AM

If you are in over your head and you can sell it now and break even what are you waiting for?

**carrot** · 01-11-2008, 06:42 AM

Your title-"In Over My Head" and what Greg says makes me believe you want out. So I agree with Gregg and move on. Sell!

**InOverMyHead** · 01-11-2008, 06:47 AM

I dont think the current tenants are in any position for a lease-to-buy deal - I can barely get the monthly rent from them.

The only thing I'm waiting for is a buyer!

I havent tried a realtor yet, but I guess thats the next option. Only problem with that is figuring out how to price it down and pay realtor commission fees to be able to come out OK. I dont know if I can do both. So then if I have to take a loss, I'm questioning whether it isnt better to just hold, pay out-of-pocket for months to come, and hope the market turns around enough to price it up in a year (or two).

**Jim** · 01-13-2008, 10:25 AM

Stop fooling aropund on the web and get a local agent to help you. They will be able to give you a CMA and tell you what your property is really worth in todays market. They will help answer your questions so you can decide what makes sense.

**REbuyersgroup** · 01-14-2008, 06:19 PM

Where in FL is the property?

You may want to consider a Short Sale if the value of the property is less than what is owed and you can no longer make the payments "Hardship".

The bank may agree to a sale, accept less than the note, and consider it a satisfied loan.

Short Sale is better than a Deed in Lieu of Foreclosure, or Foreclosure.

There may be some Tax consequences, so discuss with your CPA, since this is an investment property and not a Homestead property. Homestead property has tax breaks so you would not have to pay on the deficiency.

**Macye Kirkpatrick** · 01-15-2008, 05:43 AM

Are your current tennents lease up soon? When it is you should look to get new ones. Why are you not leasing the property at a higher fee to cover cost? Where is the property located in Florida? Maybe a property managment company would be able to get the right tennant in there at the correct fee. You could do this until your ready to sell. I let the tennents know the price is changinig when the lease is up so they can plan to move.