It will cost me 8k to sell my house
I can’t put it simple than that. The realtor sent me a PDF with a projected sales price and a breakdown of all the fees, which there are over 10k in fees alone, of what it will cost me. One thing I forgot to consider was the property taxes in the state of Illinois are paid in the rear. So this year I am paying 2006 taxes and my escrow is building up for 2007 taxes. That part hit me off guard a little bit.
Even if the house were to sell for more than what the realtor suggested, it still doesn’t reduce it a whole lot. Either way I have to come up with some money to get rid of the house, or just hold out on it until things change. There’s a reason for why the area I am in is losing value: renters. Every other house in my neighborhood is rented! Having so many in this area lowers the value of the units that are lived in by the owners. The renters have really made themselves known over the past few months. Lots of noise, increased parking on the streets, dogs (and what they do), and worst of all is spray paint on the sidewalks. It is beyond me how so much can change in an area within a year. At the same time I am concerned it may cost me more if I were to sell next year. There have also been two foreclosures in the neighborhood that push things way under market value.
So why would it cost me 8k to sell the house? The equity in the house isn’t very high because I had very little down payment and have an 80/20 mortgage setup to avoid PMI. After everything is settled with the first mortgage, the difference between the balance on my HELOC and what is left is 8k. If I don’t use a realtor I could save half of the 5% commission and do for sale by owner. That would probably reduce the amount I would need to come up with at close.
Just so everyone knows, I can afford my house. I am not in any way in the position of facing foreclosure if it were not to sell. Everything is current and I can hang onto the house just fine. The area has just changed to something my wife and I are not happy with and moving closer to the city is more appealing. We’re going to improve some areas the realtor pointed out to us and do a real extensive cleaning this weekend.
It sucks when you can’t figure out what to do. I know I mentioned to you before that my husband and I are in the same boat also. I was just mentioning to my husband yesterday about taking a loss on the house. Our neighborhood is really off also. An investor is selling our same house for about $35,000 less than what we bought ours for. My husband went to go look at it and he said the house is “badly used” on the inside. That is probably why nobody has jumped on it yet. But I found out that 2 other houses(same floor plan) sold for the same amount and one for a little bit more than ours about 4 months ago. The real estate agent said wait till next year. I am thinking if we wait till say March to put it on the market. What if we take a $20,000 loss? About 90% of our mortgage payment is going towards interest anyway. We called the our mortgage company and they said that if there is a short sale, that most likely they would just make us pay the same monthly amount until it is paid off. I am thinking that is reasonable. Because what if we wait until March of 2009 to sell and the market hasn’t picked back up? We could still take a loss and a whole year has passed in the process.
I don’t know about your area but I realized that we are going to need a real eastate agent. Buy owners are harder to sell around here. When next year comes around we are going to have some money to cover realtor fees. I don’t know. I see your issue. I think you have to go with your gut feeling. We can pay for our house also but it is bringing us down emotionally because we want to move. Good luck! I’m sure you’ll do what is right for you.
What’s the proposed sale price? $8k doesn’t sound too bad. Shame though, since you can do just about everything yourself on the Internet these days.
Sorry to hear about your neighborhood. I’d probably want to sell and move out too if people were spray-painting on the sidewalks.
Sorry to hear this, the real state market is in the toilet, I would hold on to the property and wait a couple of years.
Great time to buy insvestment properties, real state is the shortcut to wealth!