Housing bust - R2I dilemma

rspr · Post by **rspr** » Tue Feb 10, 2009 3:19 am

Hi,

With the housing bust in USA, I am sure it is impacting R2I for lot of folks, and I am one among them.

Just wondering what others are thinking/planning about R2I, when they own the house here. The options are...

1) Sell the house at loss - Take a huge hit on savings most of us have
2) Rent the house - How to manage the difference between mortgage + property taxes and rent, when in India
3) Stay back for some more time - This directly impacts R2I by delaying the move.

Please share your opinions, recommendations, what you did, what you plan to do, etc. This is one thing for sure which is holding me back for the time being.

Thanks
rspr

GSJ · Post by **GSJ** » Tue Feb 10, 2009 3:28 am

rspr,
I am in the same boat. Family there, me here. waiting for house to sell. The 1 mistake I think I did was put it on FSBO earlier and waited, should have engaged a realtor. I do have one now, but things are slow anyway. The only thing we can do is either wait and wait OR reduce price sell off.
What are your strategies? any ideas?

R2I-2019 · Post by **R2I-2019** » Tue Feb 10, 2009 3:46 am

rspr;150610Hi,

1) Sell the house at loss - Take a huge hit on savings most of us have
2) Rent the house - How to manage the difference between mortgage + property taxes and rent, when in India
3) Stay back for some more time - This directly impacts R2I by delaying the move.

Thanks
rspr[/quote]

I am not going back anytime soon so I am sure I cannot be in your shoes. But just based on some information renting can be pain to manage totally off site. There are some agencies who will do that for a commission. Maintainence, agencies, trouble of finding renters, cost of owning etc etc are lot headaches and very major problem in remotely renting a place. There are instances where if something goes out in house you can do it cheaper but agencies will charge you premium to fix a dishwasher.

May be do both, try selling at a loss and staying back for little longer. Just say if you sell at a loss of 50k and stay back by one year than planned then may be you can recover your losses by making that extra income for one year.

Have you already purchased house in India? If not then wait a little longer for buying one in India and may be real estate slow down there will help you get some better deal. This in turn might help saving some money.

You do not have to sell it and leave today. But you can sell it soon and then rent for a little bit to recover those losses by having that job.

Just some random thoughts without any personal experience.

MadMax · Post by **MadMax** » Tue Feb 10, 2009 4:27 am

Stayput.

sftrade · Post by **sftrade** » Tue Feb 10, 2009 5:29 am

What is the notional loss till date ??

MINDIA · Post by **MINDIA** » Tue Feb 10, 2009 11:00 am

I rented my house in Dallas area without any issues. I have not engaged in any management services. I found a South Asian tenant and I think that made things little bit easier. Remote management is not as big as it seems. I have couple of good friends in the same street who took care of the stuff in the intial stages. I bought Home warranty service for $500 and that took care of some minor headaches.
But again, if my tenant leaves I might be in a tough spot.

sricitco · Post by **sricitco** » Tue Feb 10, 2009 11:18 pm

Don't want to sound too negative but the option of "Staying back for some more time" could turn into "Staying back for a long time" as the market is not expected to turn around anytime soon.

If your timeline to R2I is next 1-2 years then option 3 should be ruled out.

Chakravyuh · Post by **Chakravyuh** » Wed Feb 11, 2009 12:19 am

Need to closely look at option 1. If you take a hit, what do you gain ?
Is the gain more than the hit even if the hit is more big. Example,
do you have a home that is paid off in india, in which case you can recoup by saving on mortgage. Even otherwise, you will have to deal at themost with one mortgage rather than 2 like in my case.
advantages with certain things like staying close to family , etc . cannot be measured vs. the hit you would take. So suggest try to think outside the box like taking the huge hit option 2 and 3 will prolong your r2i which will defeat the purpose and given the current economic scenario and the various circumstances, you could be stuck for a long time.

Good luck.

rspr · Post by **rspr** » Wed Feb 11, 2009 1:42 am

Thanks for the responses guys.

As sricitco mentioned, it might turn into long one, I am scared.

I originally thought of moving ASAP, but slowly reality started sinking in. Jobs back in India is not great currently. So, low salary and more so unhappy about the potential work/position in the current market. Adding housing problem to it, simply pushed me at least 1.5 to 2 years from ASAP.

So, wanted to check if there is something different other folks would suggest.

~ rspr

MadMax · Post by **MadMax** » Wed Feb 11, 2009 3:44 am

Stayput for 5 years and then re-evaluate R2I. It needs to be an iterative process. Don't get sucked into the waterfall model mindset. Also, don't forget to enjoy life all the while though. That is the most important part. R2I and LIA are just maya.