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Answers (6)
- Jim Maki, "makijim"
- Contributions:62
Get a local Realtor to give you a Market Opinion as to value. If the house is free and clear I would recommend cleaning up and even doing some painting. This is the right time of year. Interest rates are low..
Make the place sparkle! Get it on the market ASAP. No one knows when things will turn around. My guess is that Detroit is in for a long price depression and waiting will only make things worse. Just my opinion. Estate properties should be sold as quickly as possible in most cases.
Make the place sparkle! Get it on the market ASAP. No one knows when things will turn around. My guess is that Detroit is in for a long price depression and waiting will only make things worse. Just my opinion. Estate properties should be sold as quickly as possible in most cases.
- sunnyview
- Contributions:25139
I agree with titan 100%.
- Maria Morton, "MariaMorton"
- Contributions:716
I like titan10's answer the best. However, this answer is totally business and it sounds like your brother may have some financial/survival issues. Maybe the 3 of you could sit down and crunch the numbers in the various scenarios provided by titan10. By using factual data, you can all 3 see the objective data. Looking at the numbers together will help everyone feel involved in the decision making process and give your brother the opportunity to talk over his situation and plans for his future.
Keep in mind that we are in a market situation that is unique in history so no one knows exactly what may happen in the future. Also, there is a limited amount of waterfront property. This makes it valuable. If you believe that property values on your lake will increase over time, you may decide that holding onto the house for 5 or 10 years would be a good investment.
Keep in mind that we are in a market situation that is unique in history so no one knows exactly what may happen in the future. Also, there is a limited amount of waterfront property. This makes it valuable. If you believe that property values on your lake will increase over time, you may decide that holding onto the house for 5 or 10 years would be a good investment.
- titan10
- Contributions:826
look at the current monthly income it would provide vs current cash value and relate it in a annual percentage rate. For example, 135k house after selling it might be 120k after cost of sale. It might get 1k a month for rent, and x 12 = 12,000. This rate of return is 10% apr, which is not that bad. However, you have to factor in possible repairs, property taxes etc. If taxes and repairs and insurance bring it down to 4-5% and your debt is more expensive, than you may consider selling.
Any gains in possible appreciation might be offset by current credit card interest, etc.
What a investor would do if the house was a good one to hold, would be to leverage the house, pay off the credit cards, and the rent would cover the mortgage. Just keep the payment considerably less than the rent that comes in, to cover vacancy and repairs, and other surprises.
The numbers in a leveraged situation with the above numbers but a 50k mortgage would be the following:
268 p&i payment
-60 in payed down principle
=208 in monthly costs
1000 mo income =792 net monthly x 12 =9504 annually
vs after paying off the mortgage(you already took 50k) you would net around 70k
9504/70000= 13.5% apr
which means by leveraging you increased your return on your asset.
Keep in mind, that this leaves out many costs including taxes, repairs, etc. It is just different ways of thinking for you to do your analysis and make the decision best for you.
Any gains in possible appreciation might be offset by current credit card interest, etc.
What a investor would do if the house was a good one to hold, would be to leverage the house, pay off the credit cards, and the rent would cover the mortgage. Just keep the payment considerably less than the rent that comes in, to cover vacancy and repairs, and other surprises.
The numbers in a leveraged situation with the above numbers but a 50k mortgage would be the following:
268 p&i payment
-60 in payed down principle
=208 in monthly costs
1000 mo income =792 net monthly x 12 =9504 annually
vs after paying off the mortgage(you already took 50k) you would net around 70k
9504/70000= 13.5% apr
which means by leveraging you increased your return on your asset.
Keep in mind, that this leaves out many costs including taxes, repairs, etc. It is just different ways of thinking for you to do your analysis and make the decision best for you.
- Liz Harrison, "Spruce It Up!"
- Contributions:40
Perhaps your brother could pay some rent to the other 2 of you while he lives at your lake house. That could help you pay off some debt and buy you some time to let the market improve.
- wetdawgs
- Contributions:26833
Detroit prices are not a pretty picture, as you are probably well aware. They will recover when the auto industry recovers (i.e. in a long long time in my opinion).
If your brother wishes to stay in the house, have him pay 2/3 of fair market value rent as the 3 of you own it, plus be responsible for all maintenance, utilities etc. I would recommend a legal document about his rental status.
Or, I'd put it on the market immediately.
If your brother wishes to stay in the house, have him pay 2/3 of fair market value rent as the 3 of you own it, plus be responsible for all maintenance, utilities etc. I would recommend a legal document about his rental status.
Or, I'd put it on the market immediately.
To sell now or postpone?
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