We purchased a condo about 2 years ago with 30,000 down and we are now renting the condo out. With the condo fees, insurance and other expenses we are still paying aproximatley 1000,00 a month for this condo. We are also renting an apartment for 995.00 a month in our current location. We are thinking of selling the property soon but are unsure because of the market at this time.If we did not make at least our 30,000 back that we put down we feel as if we have just wasted the money. What should we do?
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you probably should rent the condo, so you guys an have more money in your pocket.
If you are taking a loss monthly anyway, selling the condo would be the last loss you take, and can move ahead with no more monthly and yearly loss. The market is always in a cycle process. Things aren’t as bad as they will get in the future, now would be a good time to cut and run if you can. Good Luck!
It all depends on your situation and the state the condo is located in. There are some very soft states at the moment such as California, Florida, Nevada, Arizona and could be a few years until we have a turnaround in these markets. The other important factor is if the condo is in a very desirable area that has high demand and great job market.
You could always contact a realtor in that market (check out realtor.com) and they can let you know how strong or weak the market is where you own. If your condo has not appreciated you will actually lose money from the 30K you put down because you have closing costs including realtor commissions 5-6% as well as escrow/title fees.
The other important factor is how much of a negative cash flow you have from what you receive in rents minus expenses and if you can sustain the negative cash flow for very long.
Also condo’s don’t move as fast as single family homes as far as selling unless the market is in very high demand i.e. Los Angeles, Seattle, Manhattan etc…
The other bigger picture is you will normally make money on this condo if you can hold on to it long term 7-15 years.