Is it good time to sell Irvine property?

S

Sunnyirvine

Member
Bought SFR in peak market, we lived and currently renting out since 2013. Renter offered to buy, not sure if  this is the good time to sell or continue renting. Benefit of selling to renter, no broker commission and worry about income flow. We can reinvest when market takes dip or soon in the location with zip codes where appreciation potential is higher in Irvine. Current home is in West Irvine.

Thoughts please!!!
 
Sunnyirvine said:
Bought SFR in peak market, we lived and currently renting out since 2013. Renter offered to buy, not sure if  this is the good time to sell or continue renting. Benefit of selling to renter, no broker commission and worry about income flow. We can reinvest when market takes dip or soon in the location with zip codes where appreciation potential is higher in Irvine. Current home is in West Irvine.

Thoughts please!!!
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If you have a buyer and you are selling without an agent, you are already saving yourself about 6% right off the bat.  I think market is peaking right now so based on the fact you will save money on selling costs and the fact I think market is peaking, I would sell.  Also since you have lived in this house for 2 of the last 5 years there will be no taxes.  If you wait till next year or later, you will have to pay capital gains.  I am sure many others will have different opinions depending on each persons agendas, interests and biases however.

I have also told this to other people with rentals on this site.  If you wouldnt buy your house right now as a rental, then I wouldnt keep it as a rental.  Some may argue keep it for appreciation but in general I think keeping rentals for appreciation is a fools game, especially in this climate. 
 
Sunnyirvine said:
Bought SFR in peak market, we lived and currently renting out since 2013. Renter offered to buy, not sure if  this is the good time to sell or continue renting. Benefit of selling to renter, no broker commission and worry about income flow. We can reinvest when market takes dip or soon in the location with zip codes where appreciation potential is higher in Irvine. Current home is in West Irvine.

Thoughts please!!!
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Will the renter move out if you don't sell to them?
 
hello said:
Sunnyirvine said:
Bought SFR in peak market, we lived and currently renting out since 2013. Renter offered to buy, not sure if  this is the good time to sell or continue renting. Benefit of selling to renter, no broker commission and worry about income flow. We can reinvest when market takes dip or soon in the location with zip codes where appreciation potential is higher in Irvine. Current home is in West Irvine.

Thoughts please!!!
Click to expand...

If you have a buyer and you are selling without an agent, you are already saving yourself about 6% right off the bat.  I think market is peaking right now so based on the fact you will save money on selling costs and the fact I think market is peaking, I would sell.  Also since you have lived in this house for 2 of the last 5 years there will be no taxes.  If you wait till next year or later, you will have to pay capital gains.  I am sure many others will have different opinions depending on each persons agendas, interests and biases however.

I have also told this to other people with rentals on this site.  If you wouldnt buy your house right now as a rental, then I wouldnt keep it as a rental.  Some may argue keep it for appreciation but in general I think keeping rentals for appreciation is a fools game, especially in this climate.
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Interesting point, please educate me a little about this rule of living in house for 2 years out of last 5 = no taxes on selling it?
 
If the house was your primary residence at least two of the last five years, you can exclude from capital gains tax, up to a $250K gain if single, and $500K if married.
 
Subjective. Depends on your goals. Sounds like you have an itch to sell to renter. Then sell to renter.  The future of OC RE prices hinges on what the federal reserve is going to do. No one has a crystal ball, no one can tell you "yes this is a good time to sell" or "no this is a bad time to sell".
 
Does oc real state depend on fed reserve really? Seems like large portion of it driven by cash foreign buyers who aren't worried about interest rate loans. If global economy weak won't that affect Irvine less as more foreign cash buyers may buy here???
 
I would sell before the presidential election if I were you.  There are less foreign buyers since the US dollar has appreciated so much.  It's much cheaper for China buyers to buy in Canada, U.K. And Australia.
 
Just to be clear folks, as of right now it's a rental property isn't it?

The $250k capital gains tax or $500k married is if it's an owner occupied residence..or at least he's been living in the past 2 years of the 5 years.

In this scenario it sounds like he wouldn't be qualified for it. He could do a 1031 exchange to go from one rental to another and not take the capital gains tax hit but not the one people are talking about

I'm no cpa, just info I've read fyi
 
Sunnyirvine said:
Bought SFR in peak market, we lived and currently renting out since 2013. Renter offered to buy, not sure if  this is the good time to sell or continue renting. Benefit of selling to renter, no broker commission and worry about income flow. We can reinvest when market takes dip or soon in the location with zip codes where appreciation potential is higher in Irvine. Current home is in West Irvine.
Thoughts please!!!
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Do you like the house?  (Did you like/enjoy living in the house?)

 
sell4u said:
Subjective. Depends on your goals. Sounds like you have an itch to sell to renter. Then sell to renter.  The future of OC RE prices hinges on what the federal reserve is going to do. No one has a crystal ball, no one can tell you "yes this is a good time to sell" or "no this is a bad time to sell".
Click to expand...

Future OC Real Estate prices aren't driven on what the fed may or may not do.  They are driven off the local employment strength and foreign demand to a lesser extent.
 
SoclosetoIrvine said:
Just to be clear folks, as of right now it's a rental property isn't it?

The $250k capital gains tax or $500k married is if it's an owner occupied residence..or at least he's been living in the past 2 years of the 5 years.

In this scenario it sounds like he wouldn't be qualified for it. He could do a 1031 exchange to go from one rental to another and not take the capital gains tax hit but not the one people are talking about

I'm no cpa, just info I've read fyi
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All depends on how long they have rented it out since moved out.  If it's been less than 3 years and they qualify for the $250k/$500k I would sell if there is an unrealized gain.
 
Sunnyirvine said:
Bought SFR in peak market, we lived and currently renting out since 2013. Renter offered to buy, not sure if  this is the good time to sell or continue renting. Benefit of selling to renter, no broker commission and worry about income flow. We can reinvest when market takes dip or soon in the location with zip codes where appreciation potential is higher in Irvine. Current home is in West Irvine.

Thoughts please!!!
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If you do decide to sell, I can send you a blank CAR Residential Purchase Agreement and refer you to a good escrow company.  Just PM me.
 
USCTrojanCPA said:
sell4u said:
Subjective. Depends on your goals. Sounds like you have an itch to sell to renter. Then sell to renter.  The future of OC RE prices hinges on what the federal reserve is going to do. No one has a crystal ball, no one can tell you "yes this is a good time to sell" or "no this is a bad time to sell".
Click to expand...

Future OC Real Estate prices aren't driven on what the fed may or may not do.  They are driven off the local employment strength and foreign demand to a lesser extent.
Click to expand...

It absolutely does. 

The world is a wash in cheap money along with negative interest rates. 

What the federal reserve does absolutely will have an impact on orange county real estate.  I guarantee it.
 
sell4u said:
It absolutely does. 

The world is a wash in cheap money along with negative interest rates. 

What the federal reserve does absolutely will have an impact on orange county real estate.  I guarantee it.
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Um...I'm gonna take USCTrojanCPA's word over yours any day of the week.  He's got an acute handle on the local real estate market, as well as the macro financial markets, and has the garage to prove it.  Not sure how you back your guarantees, but talk is cheap.
 
sell4u said:
USCTrojanCPA said:
sell4u said:
Subjective. Depends on your goals. Sounds like you have an itch to sell to renter. Then sell to renter.  The future of OC RE prices hinges on what the federal reserve is going to do. No one has a crystal ball, no one can tell you "yes this is a good time to sell" or "no this is a bad time to sell".
Click to expand...

Future OC Real Estate prices aren't driven on what the fed may or may not do.  They are driven off the local employment strength and foreign demand to a lesser extent.
Click to expand...

It absolutely does. 

The world is a wash in cheap money along with negative interest rates. 

What the federal reserve does absolutely will have an impact on orange county real estate.  I guarantee it.
Click to expand...

If what you're saying is true, than all areas (not just the OC) will be impacted in the same way, right?  RIGHT?  right.....didn't think so.  I highly doubt OC real estate will move exactly like IE, LA County or Bakersfield real estate based solely on the actions of the Fed.
 
sell4u said:
Subjective. Depends on your goals. Sounds like you have an itch to sell to renter. Then sell to renter.  The future of OC RE prices hinges on what the federal reserve is going to do. No one has a crystal ball, no one can tell you "yes this is a good time to sell" or "no this is a bad time to sell".
Click to expand...

Future OC Real Estate prices aren't driven on what the fed may or may not do.  They are driven off the local employment strength and foreign demand to a lesser extent.
[/quote]

It absolutely does. 

The world is a wash in cheap money along with negative interest rates. 

What the federal reserve does absolutely will have an impact on orange county real estate.  I guarantee it.
[/quote]



Ok then please explain to me why interest rates are lower today versus this time last year when the Fed Funds Rate is higher today than it was last year at this time?  The Fed only controls short-term rates and those short term rates do not dictate where mortgage rates are.  Mortgage rates are based off of MBS bond rates along with lender credit spreads. 
 
My_Alter_Ego said:
sell4u said:
USCTrojanCPA said:
sell4u said:
Subjective. Depends on your goals. Sounds like you have an itch to sell to renter. Then sell to renter.  The future of OC RE prices hinges on what the federal reserve is going to do. No one has a crystal ball, no one can tell you "yes this is a good time to sell" or "no this is a bad time to sell".
Click to expand...

Future OC Real Estate prices aren't driven on what the fed may or may not do.  They are driven off the local employment strength and foreign demand to a lesser extent.
Click to expand...

It absolutely does. 

The world is a wash in cheap money along with negative interest rates. 

What the federal reserve does absolutely will have an impact on orange county real estate.  I guarantee it.
Click to expand...

If what you're saying is true, than all areas (not just the OC) will be impacted in the same way, right?  RIGHT?  right.....didn't think so.  I highly doubt OC real estate will move exactly like IE, LA County or Bakersfield real estate based solely on the actions of the Fed.
Click to expand...

Just another realtor who doesn't understand macro/microeconomic and the true drivers of interest rates. 
 
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