Selling my house in Miami, is it smart decision?

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rodrigoviolante
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Joined: Mon Nov 13, 2017 10:01 pm

Selling my house in Miami, is it smart decision?

Post by rodrigoviolante » Mon Nov 13, 2017 10:05 pm

Hello, everyone has seen this crazy bull market, and to be honest I don't feel it will continue this way. So I'm selling my house for three reasons. I'm am even taking a loss on the sale.

1.- I have 50% still in mortgage
2.- Have cash (or ETF) to be able to buy good opportunities if the market crashes.
3.- House Market in miami is crazy high.

I wanted to have your opinions, is it smart to sell a house at this point, or just keep it long term?

Thank you

Rodrigo

123
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Re: Selling my house in Miami, is it smart decision?

Post by 123 » Mon Nov 13, 2017 10:34 pm

A lot depends on if you intend to move to another area or if you're downsizing in the same area or if you've decided you'd rather rent.
The closest helping hand is at the end of your own arm.

rodrigoviolante
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Re: Selling my house in Miami, is it smart decision?

Post by rodrigoviolante » Mon Nov 13, 2017 10:42 pm

I'm thinking in renting, until I see better opportunities.

aaronl
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Re: Selling my house in Miami, is it smart decision?

Post by aaronl » Mon Nov 13, 2017 10:53 pm

Owning a house long-term in Miami does not sound like a good idea to me.

Caduceus
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Re: Selling my house in Miami, is it smart decision?

Post by Caduceus » Tue Nov 14, 2017 5:12 am

I don't think anyone on the board can answer this question for you with the information provided. Some things to think about:

Would you buy the same house again at the current price if given the chance?

What is the price-to-rent ratio (the price of the house divided by its annual after-costs rent)?
'
How would your financial situation change if your home value dropped by 10%? What about if it dropped 30%?

denovo
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Re: Selling my house in Miami, is it smart decision?

Post by denovo » Tue Nov 14, 2017 5:22 am

If housing prices have gone crazy-up, how are you losing money?

runner540
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Re: Selling my house in Miami, is it smart decision?

Post by runner540 » Tue Nov 14, 2017 7:14 am

These economists do a buy vs rent index (much more comprehensive than just dividing house price by rent), and according to their work, Miami slightly favors renting right now. No where near as clear as during the housing bubble.
https://business.fau.edu/departments/fi ... graphs/#FL

Dallas, Denver and Houston on the other hand are clearly favorable for renting.

(gekko)
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Location: Florida

Re: Selling my house in Miami, is it smart decision?

Post by (gekko) » Tue Nov 14, 2017 4:20 pm

Yes, I know your feelings. I have an apartment there and since January 2016 it’s up 30%!

Atgard
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Re: Selling my house in Miami, is it smart decision?

Post by Atgard » Tue Nov 14, 2017 4:47 pm

rodrigoviolante wrote:
Mon Nov 13, 2017 10:05 pm
Hello, everyone has seen this crazy bull market, and to be honest I don't feel it will continue this way. So I'm selling my house for three reasons. I'm am even taking a loss on the sale.
Something is missing... you think housing prices in Miami are "crazy high" and in a "crazy bull market," but you'd take a loss if you sold your house now? Something doesn't add up.

Did you buy it very recently and are having buyer's remorse? Do you think the housing market is at a "high" and are trying to time the market (most here will tell you that is usually a losing game)?

Did you buy a house that you can afford and that meets your needs? If not, why did you buy it? If so, have your needs changed in some way?

hale2
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Re: Selling my house in Miami, is it smart decision?

Post by hale2 » Tue Nov 14, 2017 5:49 pm

aaronl wrote:
Mon Nov 13, 2017 10:53 pm
Owning a house long-term in Miami does not sound like a good idea to me.
Why? Just curious.

rodrigoviolante
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Joined: Mon Nov 13, 2017 10:01 pm

Re: Selling my house in Miami, is it smart decision?

Post by rodrigoviolante » Tue Nov 14, 2017 5:53 pm

Thanks, everyone that has posted information.

Just to clarify this, its not about if I did a smart investment 2 years ago buying the house. Its more about if its smarter to sell assets and stay in cash than keep the house that might fall hard after the next crash, that at some point it will happen.

If its a nice house, ugly house, etc doesn't matter.

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HomerJ
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Re: Selling my house in Miami, is it smart decision?

Post by HomerJ » Tue Nov 14, 2017 5:53 pm

hale2 wrote:
Tue Nov 14, 2017 5:49 pm
aaronl wrote:
Mon Nov 13, 2017 10:53 pm
Owning a house long-term in Miami does not sound like a good idea to me.
Why? Just curious.
Flooding.

Miami is built on limestone, so you can't even build a wall around it to keep the sea out; it soaks up from underneath.

They recently upgraded their pumps, so they are somewhat keeping up with the problem, but I would never ever buy anything in Miami as a long-term purchase.

http://www.miamiherald.com/news/local/c ... 41856.html

PFInterest
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Re: Selling my house in Miami, is it smart decision?

Post by PFInterest » Tue Nov 14, 2017 5:54 pm

if you are taking a loss then they are not crazy high prices.

rodrigoviolante
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Re: Selling my house in Miami, is it smart decision?

Post by rodrigoviolante » Tue Nov 14, 2017 5:56 pm

Well I'm taking a loss considering all the upgrades to the house, and I'm also to be under market value to sell it faster.

abracadabra11
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Re: Selling my house in Miami, is it smart decision?

Post by abracadabra11 » Tue Nov 14, 2017 7:56 pm

Rodrigo,

Unfortunately, you've come to the wrong place for the advice your seeking. No one on this board (or collectively) can accurately assess whether it's sensible to sell your house now or wait 6 months or wait 10 years. If you care to post additional details about your financials, then you'll receive lots of good advice on whether you're spending too much on your mortgage, not investing sufficiently, and/or poorly allocated across stocks/bonds. Absent this, your flip of a coin is about as good as ours. As a general recommendation, selling any investment because you 'think' the market is 'too hot' is not a strategy that's ever endorsed here. Whether a home is an investment is a topic you'll find often debated.

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HomerJ
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Re: Selling my house in Miami, is it smart decision?

Post by HomerJ » Tue Nov 14, 2017 8:18 pm

abracadabra11 wrote:
Tue Nov 14, 2017 7:56 pm
Rodrigo,

Unfortunately, you've come to the wrong place for the advice your seeking. No one on this board (or collectively) can accurately assess whether it's sensible to sell your house now or wait 6 months or wait 10 years. If you care to post additional details about your financials, then you'll receive lots of good advice on whether you're spending too much on your mortgage, not investing sufficiently, and/or poorly allocated across stocks/bonds. Absent this, your flip of a coin is about as good as ours. As a general recommendation, selling any investment because you 'think' the market is 'too hot' is not a strategy that's ever endorsed here. Whether a home is an investment is a topic you'll find often debated.
Good post.

Yes, in general, we don't believe in predictions here. None of us here can tell you if it's a good idea to sell today or not. If you have a large amount of your net worth tied up in this house, then we might counsel you to sell it so you can diversify your risk.

But none of us know if Miami is a "hot market", or whether or not it's a good idea to sell, and buy back in "after the next Miami housing crash". Just like the stock market, you might sell, watch prices double again, drop 40%, and then you'd have to decide if you wanted to buy back in at HIGHER PRICE.

michaellarimore
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Re: Selling my house in Miami, is it smart decision?

Post by michaellarimore » Thu Dec 07, 2017 8:12 pm

I've considered selling many times; each time i am VERY, VERY glad that i did not-

Some things to consider-
1) Save Our Homes Tax break- If your home has appreciated significantly, your taxes have been limited to 3% by state law; you are paying far less tax then your neighbor. If you sell, you can take your tax break to a new FL residence within 2 years. BUT I believe that your tax rate will then increase 10% per year until it reaches normal.

2) Rents in Miami are very high- You probably won't want to rent for too long.

3) There are a lot of condos out there and condos always get hit hardest in a down-turn.

We've decided to stay put for the time being - Too much work to move and we like our house.
Increasing traffic makes our location likely to increase in demand.

PS- Major Hurricanes and Rising Water are not likely to happen anytime soon...
Real Estate corrections are a different story, they happen:(

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