End of My Rope

Tuesday, July 26, 2011

On Saturday, I suddenly realized I hadn't blogged since last Tuesday. Prior to that, I hadn't thought about it in days. Not once.

It was just one of those weeks.

On Thursday, I pulled into the driveway after picking up Nora from daycare. Michael met me at my car, saying, "It's 95 degrees in the house." He wasn't kidding. It was literally 95 degrees inside. Our central air conditioner decided to die on the hottest day of the year. We set a record high of 98 degrees, with a heat index of 113.

We immediately packed up and got the hell out of here, retreating to my mom's house for the night. Thankfully, we had a home buyer's warranty taken out on place, which covers anyone who buys our property for up to a year--and covers us while we are on the market. We were able to place a claim through that insurance company, and a serviceman came out on Friday morning and fixed the A/C. Even with the air working, it took several hours for the house to cool down again, so I spent the day working from home and cleaning in lower-90 and upper-80 degree indoor temps. I'm not going to lie; it was unpleasant.

We had another wedding on Saturday. We bought 19 gallons of paint for the new house at the Sherwin Williams 40% off sale. We visited with family on Sunday.

At the back of our minds during all of these everyday life occurrences, we were thinking about what the hell we're going to do about our condo (like always). Which, as you have probably assumed by now, has still not sold. We are just a few days shy of six months on the market. This is so far from our ideal scenario, I'm almost not even sure where our minds were when we originally started this nightmare.

We've had countless conversations, and we're ambivalent. We should find a tenant. No, we don't want to rent it out. We should drop the price drastically to make a last-ditch effort to sell. No, we should wait a few years to see if the market rebounds and we can sell for a better price.

In all honesty, it's sort of a lose-lose situation for us.

We don't want to be landlords. We wouldn't make any money by doing so. We'd have to worry about things breaking (mainly our ancient furnace and air conditioning), in not one house, but two. We spent a lot of time and money fixing this place up. We put in new carpet last summer, and we're afraid a tenant will destroy it.

But we don't want to sell for a rock-bottom price, either.

In the end, I know that we'll be OK. One year, five years, ten years into the future, we're going to be in a better place about this condo. Maybe we'll be landlords and it won't be as bad as we're imagining, and we'll make our money back. Maybe we'll finally sell it, and we'll never look back.

The thing is, I'm at the point where I kinda just don't care. As long as we're not paying two mortgages come October 1st, I am indifferent about how we get there. I just want a resolution. Because unless you have lived for six months (or, God forbid, longer than that) with this kind of weight on your shoulders, you have no idea what kind of toll this amount of stress can take.

What it really all comes down to--at least for me--is that I don't know when to call it quits and give in. I don't know when we should officially accept that we aren't going to sell this place, and turn toward searching for a suitable tenant. Because although I have come to terms with the possibility of renting, I would still much prefer to sell.

Our contract with our current realtor expires next week, and we have plans to re-list with a new realtor. I'm honestly not sure that he'll be able to do anything differently than our old realtor; I'm not sure that our old realtor did anything wrong. It just feels like we have to make a change, given that it's been six months. A new perspective, a breath of fresh air--sort of a fresh start, if nothing else. In my dreams, he comes in here and somehow manages to pull of a miracle and sell this place within a few weeks of it being back on the market. As we've been saying all along, it only takes one.

But if the end result is going to end up being the same--meaning we have to rent it--then we'd honestly rather get someone in here starting September 1st, instead of waiting until October 1st. And if we're going to do that, we need to start looking for a tenant... right now.

We know we could play both angles at this point. We could put a rental ad out there, and we could keep it on the market, and we can see what comes of it. And maybe that's what we'll end up doing, believing all the while that whatever happens to work out--whether it's a buyer or a renter--is what is meant to be. But if we sign a lease with a tenant, I don't know that I'll feel complete peace with it. I can see myself wondering, "What if we had given it just a little more time on the market?"

Thus continues the dilemma.

We are so ready to be done with this shit.


Heather July 27, 2011 at 12:27 AM  

I'm sorry that you are having so much trouble. I don't know what the real estate laws are in New York, but it might be helpful to choose a real estate agent who is a part of a team. Meaning they have a buyers agent and a sellers agent. Because they want to keep the commissions "in house" they tend to try to buy and sell to their own clients. Sometimes they will work harder to achieve this. Like I said though, I don't know how it works over there, but that's what happened in California.

And as far as renting, would it be less stressful to have hire a property management company? They would get any complaints from the tenants and then turn the information over to you.

Vanessa July 27, 2011 at 3:11 AM  

I'm sorry too, what a headache this is for you.
I haven't faced this dilemma before, but my broter in law has. He bought a small house 5 years ago and needed to sell because he was moving and buying abroad, and the market had gone down so that he could only get just under what he had paid for it (losing out on a gain over 5 years (most real estate in that period increased in value) and on money spent doing the place up). He opted to rent for a year to see what would happen to the market and had a true nightmare with terrible tenants, so that in the end he decided to sell.
My dad (who is a good businessman and has experience of real estate) always says that you don't need to make a gain on your personal real estate. This is about your life - you wouldn't buy a house in a less good neighbourhood just because it stands to gain you more money than a house in the area you actually want to live in. He says it's the same thing here, by renting out you are giving yourself an additional workload and potentially stress that you don't need.
If I were you, if I could sell without making a loss as such (or too significant a loss), I would sell to be clear of the whole thing.
You have bigger winnings to make in your life and I agree you will look back on it and it will be less important.
BUT that is advice that does not take into account the figures at play or whether you'd have to sell at a loss or be in negative equity.
Sending you lots and lots and lots of luck!

MB July 27, 2011 at 6:00 AM  

This is such a headache - I've been in your shoes, and like you said, it's a huge weight on your shoulders. (We ended up selling for a significant loss...glad to be over with it, but still sad to see the money go).

Have you looked into any rent to own deals? Or considered renting for a year but leaving the home on the market to sell? (A home in our neighborhood did that...it's finally sold. Yay!). Just thoughts of things I've seen.

Best of luck! I will be thinking of you guys!

mashley July 27, 2011 at 7:49 AM  

Love your blog! We had a house for sale for 14 months and it didnt sell so we ended up renting it out...we are not going to make any money doing that either but it relieves us of paying the mortgage on that house for a year. We were SUPER picky on the tenants. We actually turned 3 down before we settled on a family. It only took us 2 weeks to rent it out (and turn 3 families down) Our realtor told us that more and more people are renting bc they cant get mortgages. Renting was totally not what I wanted to do but it looks like its in the card for us now...hope it all works out for you soon!

Anne Marie July 27, 2011 at 8:46 AM  

Try to stay calm as much as you can! Things will work out, no matter which direction you go. You have options although some are more desirable than others :)

Keep your head up--as my dad (annoyingly) says, things have a way of working themselves out. They always do, right?

Shauna,  July 27, 2011 at 9:11 AM  

I feel for you, Heather. Our house has been on the market for 5 months. We have a contract on a new house that we love but we won't buy that one until we sell this one. That contract expires in a few weeks and it breaks my heart that we are going to lose our perfect house.

Helen July 27, 2011 at 10:27 AM  

You know that I feel you! Our situations are so similar (other than that you have already found your house, but I think we may finally be close!). The one major thing we have working against us is that it will actually be nearly impossible to sell our condo right now. Because the renter to owner ratio is so high in our complex at this point (partially due to people like us who have outgrown the space and needed to move on in this lousy market) you can't get an FHA mortgage for our complex. So our best shot at selling will be a cash only buyer, which are few and far between these days.

As soon as we are in contract on a house we are going to list our place (AGAIN, it spent 8 months on the market last year) to sell, at the absolute lowest price we can stomach, and to rent (which we will be lucky if we can cover our monthly expenses for the place with the rental income). I would absolutely prefer to sell but we can't carry 2 mortgages for an undetermined period of time. Honestly, at this point, I think best case scenario for us will be to rent it for a year, and then sell it for whatever huge loss it ends up being because according to our accountant, at that point we could right off the loss, when we can't write it off while the place was our primary residence.

Keep your chin up! I hope the new Realtor is able to bring some better luck your way. I know how annoying it is to be constantly told 'it will all work out for the best', but in the end it does. At least that is what I have to keep telling myself!

Jessica,  July 27, 2011 at 11:30 AM  

I am in almost the exact same situation. Our condo has been on the market since *gasp* June of 2010. We finally gave up and looked at a house last Thursday that we fell in love with and decided to just go for it and deal with two mortgages or a tenant or drastically reduce the price. Then, Friday morning we got a cash offer for almost what we wanted and were under contract in no time. I knew things were too good to be true and our buyer backed out yesterday while we are in negotiations to buy the house. Luckily, we aren't obligated for anything yet but I feel your stress and your frustration. I too believe that what happens is meant to be but it sure is hard having to sit back and wait to see what that is. Best of luck to y'all.

Heather July 27, 2011 at 1:45 PM  

@Heather--The new realtor we are working with is at least with a bigger company. Hoping that might work in our favor, but not sure it will make a difference. :( A property management company is not an option because of the cost. And really, it's not the complaints we're worried about necessarily... it's the costs associated with those complaints/repairs. Unfortunately, having a property manager would just increase the costs, not lessen them! It's part of the dilemma...

@Vanessa--I tend to agree with everything you said! It's not that we wouldn't sell the condo with next-to-no gain. We very likely would. But NOTHING is moving in our neighborhood right now, which leads me to believe that a price drop may not actually result in a sale. But, we are going to give it a try. Still keeping our fingers crossed.

@MB--We have had our place listed as a "lease with the option to buy" for a few months now. Still no bites. :( As far as leaving it on the market while we rent it out, I'm not sure how that would work. With the very few tenants I've talked to so far, having the place be on the market while they're in it is a deterrent to them (don't want to be inconvenienced by showings and such). Plus, we haven't had ANYONE look at the place that is interested in using it as an income property, so I don't think anyone would be too keen on inheriting tenants. *sigh*

@Anne Marie--Thanks for your positive thoughts. :)

Heather July 27, 2011 at 1:59 PM  

@mashley--I would be interested in "talking" to you about your screening process for your tenants. As I understand it, if they are qualified (credit scores and such) and meet the rental criteria (non-smoker, no pets, etc.), and they want the place, we have to rent to them to avoid possible discrimination issues. Did you not find that to be true? I guess part of the thing that scares me most about renting is that I am afraid of what we don't know about being landlords. I talked to someone at our local Housing Council and he was helpful, but I still do not feel well educated. There is a class they offer on being a landlord, but it was offered during this week, and we just couldn't swing it with the time commitment (especially since we're not positive that's the direction we're going to end up going).

@Shauna--I'm sorry you're going through this, too! I'm even more sorry that you might lose the house you love. It's such a crappy housing market everywhere right now. If we had put in a contingent offer on our house, we would've lost it a long time ago (if they had even accepted a contingent offer in the first place). We're not regretful for the decision we made, since we literally feel so limited by how we are able to live our lives at our current place. We NEED to get out of here, it's just that we wish it were under better circumstances! It's hard to get 100% excited about moving to the new house when there is still not a resolution for the old one. I hope things look up for you (and us!) soon.

@Helen--I sent you a message on Twitter, but yeah, our situations are so similar it's ridiculous. Our HOA voted in December not to renew a contract it had with whatever entity manages the FHA program, so we are no longer allowed to accept FHA loans, either. Which, you know, effectively eliminates an entire demographic of people who would normally be looking at places like ours. We were less than pleased to get that news. The only ones we can accept now are conventional loans, or SONYMA (which I guess can be difficult to qualify for, since it's based on income). Good luck to you, too--I hope you find a house you love and a great tenant for your condo!

Heather July 27, 2011 at 2:00 PM  

@Jessica--What a disappointment to finally receive an offer and enter contract, only to have it fall through! I would be a mess about that. I'm sorry. :( As disheartening as it is to hear from so many people in this same type of situation, it's also nice to know that we're not alone in this. (You know what they say, misery loves company.) Best of luck to you as well.

Vanessa July 28, 2011 at 6:18 AM  

I really feel for you and I hope so much that you find the buyer you need. I had no idea that things just aren't shifting at all. I live in London, where we haven't seen such a decline, and also we don't have the same sort of rules about mostly rented out blocks or the types of loan you can accept (sorry if that is badly/vaguely phrased, I don't think I fully understand the intricacies of the US market). I hope that the one upside of these terrible times is that you have hopefully been able to buy your house at a great price.
I can't believe what is going on with the economy right now - it is just crazy what with Federal debt and the crisis in Europe. I think we are all lucky to have graduated when we did, but I still think our generation has it so hard trying to make it in these times.
It's so difficult, I know, and I will be keeping my fingers crossed that it all works out in your favour as soon as possible. :)

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