Lifelife

Wed Feb 22, 2017, 10:52 AM

Decisions, decisions

We live in a 19th century house. Our 21st century house will be completed mid-May. What do we do with the old one? Do we rent or sell it and to whom do we sell it, a buyer who intends to live in it or a buyer looking for land to build on after tearing down the existing house?

We have some cash on hand for improvements to make it desirable for a home buyer, but we don't want to pay for all of the corrections ourselves since we want to keep some cash for expenses like furniture at the new house.

If we rent we will need to make all of the repairs since that means we will own it for another year or two, but it deprives us of money to put toward the new house resulting in a higher mortgage payment and less cash on hand following the purchase of the new house.

The developer option is easy since their interest doesn't involve the overall condition of the house. It will be demolished for a new house which may net us more money for the place at a future date, but the teardown diminishes the neighborhood's historical character which is an important consideration for us and we will not have the option of generating rental income from the property since the house no longer exists.

The interplay of these considerations reached critical mass a couple of days ago when I was approached by a developer looking at the house next door. It was purchased a few months ago by some young men who failed to fully account for the expense of gutting the house and rebuilding the foundation. They have stopped the work and are looking to get out from under their mistake. That's where the developer comes in. He wants to buy both houses, tear them down, and rebuild three or four houses on the combined lots. He proposes we contribute the land for which we get a cut of the profit in 6-8 months, when the new houses are sold. His pitch sounded good at first, based on four houses. The female real estate agent who represents some Miami investors, thinks the city will only approve three houses which greatly reduces the profit margin by 25%. Although it may be more than selling to a home buyer who is willing to overlook the imperfections of an old home to pay us a pretty penny, the land buyer may net us an additional $30 thousand dollars.

We have decided to preserve the old house. We will make the much needed repairs and put it on the market. If the home buyer offers are not to our liking after a few months we will rent it for a while and retry the market later.

Question to you. How many additional dollars would it take to hit your sweet spot in terms of selling to a land buyer instead of a home buyer? I chose $100,000 dollars because that would permit us to retire in a mortgage free home. My interest in selling to a developer begins to diminish with any figure below that.

3 votes, 1 pass | Time left: Unlimited
$1,000
0 (0%)
$5,000
0 (0%)
$10,000
0 (0%)
$15,000
0 (0%)
$20,000
0 (0%)
$25,000
0 (0%)
$50,000
0 (0%)
$75,000
0 (0%)
$100,000
3 (100%)
More than $100,000
0 (0%)
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Arrow 8 replies Author Time Post
Reply Decisions, decisions (Original post)
Agent_86 Feb 22 OP
His Daughter Feb 22 #1
Agent_86 Feb 22 #2
His Daughter Feb 22 #4
Agent_86 Feb 22 #5
KAT Feb 22 #3
Agent_86 Feb 22 #6
Squeek Feb 23 #7
Mouth of Chaos Feb 25 #8

Response to Agent_86 (Original post)

Wed Feb 22, 2017, 01:59 PM

1. Its chattel. Sell it as is and move on

You don't get you money back out of pre sale upgrades in many cases. It also lets the owner make their own changes.

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Response to His Daughter (Reply #1)

Wed Feb 22, 2017, 02:14 PM

2. Yes, that's what we have been told.

Agent 99 wants to rent thinking we will get some coin that way. I do not favor this route, but it did work out favorably with the house her son lived in, then rented.

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Response to Agent_86 (Reply #2)

Wed Feb 22, 2017, 02:20 PM

4. Older homes take some love...tennants rarely have that.

We almost sold the homestead before Dad passed away. The buildings were worthless. The land and solar farm set the price. Deal fell through and it turned out to be a good thing, and I live there now.

Hubby and I are starting to think seriously about where we are going to settle. This place has its attractions, but it is in California, a real negative for many reasons. If we decide to sell it and move on, they will be some emotion, but we will move on.

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Response to His Daughter (Reply #4)

Wed Feb 22, 2017, 02:43 PM

5. You echo some of the things I say to Agent 99.

She really disliked being a landlord. If the sale of that house had not worked out so well she would probably be dead set against renting again.

She cried at the prospect of it's destruction. I, on the other hand, would be sad. However, the handsome check would be a nice consolation prize.

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Response to Agent_86 (Original post)

Wed Feb 22, 2017, 02:17 PM

3. Hard for me. I value old, historical buildings.

Add personal history with a house, and my choice would have been fix it up and stay in it.

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Response to KAT (Reply #3)

Wed Feb 22, 2017, 02:52 PM

6. The prospect of continuing to live there is not abhorrent.

We just need more living space and I do not want to pour the necessary money into that house to make it happen.

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Response to Agent_86 (Original post)

Thu Feb 23, 2017, 04:24 PM

7. Oh geez...

I'm such a sucker for old homes. Well, most older buildings, really.

It would be real difficult for me to turn an old house over to someone I knew would tear it down, or not love it.

My own personal opinion is that most modern buildings suck. They're big time UGLY. Cold and impersonal.


If it were up to me, I would live in the old home and rent out the new one.

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Response to Agent_86 (Original post)

Sat Feb 25, 2017, 01:03 AM

8. A bird

in the hand is worth two in the bush.

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