Why do people sell their houses?

[Anonymous]

Isn't it wise to keep them as investment properties if they are not too hard to maintain and not long distance? Shouldn't they hold as long as they can? Look how much price has gone up. When parents move to nursing homes or pass away, why are their children eager to sell and split money? Can't they rent for as long as possible? I only get empty nesters who downsize from mansions which are not good investments.

[Anonymous]

Because you get a different interest rate for your primary residence.

[Anonymous]

Because they don’t want to be landlords. Because they can’t afford the upkeep or taxes. Because they don’t want to share ownership of property with siblings.

[Anonymous]

Because they are moving to a different state.

[Anonymous]

I don't want to be bothered. I kept a house and had a management company and that was a pain too. No thank you.

[Anonymous]

There are a lot of carrying costs.

We downsized fairly recently and have rented out our other house for the last two years. DH is very handy, and that helps a great deal. We lucked out and got a great tenant who renewed, but that tenant just bought a house and is leaving. Getting a nightmare tenant is a real risk, even though you can minimize the chances of it. And even with a good tenant you have to be available and ready to handle problems with the property (like the AC dying in hot weather, ugh) and that can be a PITA.

We are selling this spring -- we know we eventually would, and the true bottom line is that we want to sell now in order to avoid that tax hit, there is a lot of appreciation in the house.

[Anonymous]

There is no such thing as a house that is "not too hard to maintain". It's hard enough taking care of one house, much less more than one house. There's also the hassle of managing taxes, mortgages, difficult tenants, court fees if the tenants stop paying, etc. For the same reason some people do not want to own their own business, the same goes for owning rental properties.

[Anonymous]

Anonymous wrote:There are a lot of carrying costs.

We downsized fairly recently and have rented out our other house for the last two years. DH is very handy, and that helps a great deal. We lucked out and got a great tenant who renewed, but that tenant just bought a house and is leaving. Getting a nightmare tenant is a real risk, even though you can minimize the chances of it. And even with a good tenant you have to be available and ready to handle problems with the property (like the AC dying in hot weather, ugh) and that can be a PITA.

We are selling this spring -- we know we eventually would, and the true bottom line is that we want to sell now in order to avoid that tax hit, there is a lot of appreciation in the house.

This ^ pp here again. FWIW, the property management companies wanted one month's rent to handle getting the tenant, and another month's rent to manage the property. At that point, we would have been making very little money from renting it out, and it wouldn't be worth it. So becoming the actual landlords was necessary for us.

[Anonymous]

Can make more in the stock market with less risk

[Anonymous]

I don't understand people who hold onto houses. Especially multiple houses. It can make some financial sense but it can also be very burdensome.

My dad owned multiple properties when I was growing up, and it paid off financially but I really don't know that it was worth the headaches of dealing with bad tenants, dealing with bad neighbors of the rental properties, dealing with local landlord laws, plus all the stuff that can go wrong with maintenance and upkeep. Even if you hire a management company, they aren't always as good as you hope and it diminishes your profit.

It's a no for me. There are other ways to invest my money.

[Anonymous]

Being a landlord is a job. And a shitty one. At one point in my childhood, my parents had maybe seven rental properties, all of which were in nice enough areas (single-family homes and nice townhouses). Missing rent, broken things, negligent tenants, tenants who abandon the property, pet damage, etc. All a huge hassle. My index fund never needs a new roof.

[Anonymous]

Anonymous wrote:There is no such thing as a house that is "not too hard to maintain". It's hard enough taking care of one house, much less more than one house. There's also the hassle of managing taxes, mortgages, difficult tenants, court fees if the tenants stop paying, etc. For the same reason some people do not want to own their own business, the same goes for owning rental properties.

Yes, and people who think something won't be hard to maintain also wind up being crap landlords who don't do enough preventative maintenance or cheap out on solutions because, after all, they don't live there.

Being a landlord makes the most financial sense at a certain volume. I know people who rent out places they bought when rates were very low and it seemed like a no brainer to them because they could charge more in rent than they were paying on the mortgage. But there are all these extra costs plus sometimes places sit empty for a period of time. If you want to do it right, it's a lot of work.

On the other hand, if you don't mind being a slumlord, sure, it can be a low effort way to make extra cash.

[Anonymous]

Isn't it wise to keep them as investment properties if they are not too hard to maintain and not long distance? Shouldn't they hold as long as they can? Look how much price has gone up. When parents move to nursing homes or pass away, why are their children eager to sell and split money? Can't they rent for as long as possible? I only get empty nesters who downsize from mansions which are not good investments.

I think you answered your own question.

[Anonymous]

It's hard to be a landlord, and it's even harder to be a landlord from several states away. The only time it would make sense is if I knew we would probably be returning to live in the house again.

[Anonymous]

Your money is better invested in the market.