My wife and I are interested in full timing but we own a home.
We haven’t attempted to sell it in this market but would do so if we could get a reasonable price (Luckily we downsized from an expensive Center City townhouse in 2004). We don’t like the idea of renting it out to strangers though we might consider renting it out half the normal price to relatives or members of my wife’s chuch which would cover costs, maintenance and utilities.
Most likelly we’ll leave it empty while waiting for the market to recover. We have no mortgage while our property taxes and insurance are low ($150 a month combined). So are utilities which can be shut off anyway when we are on the road.
The one CATCH is that we don’t want to be stuck with the expenses of a high car insurance zone (near Center City Philly) when we are spending 90 percent of our time in the RV and on the road.
We own a 2000 Mazda Protégé5 and a 2005 Dodge 2500 diesel pickup. Though we’ve had no accidents or traffic tickets for decades and we are both over 55 and retired, our insurance runs close to four thousand dollars where it might run under $1000 elsewhere, especially since we wouldn’t need the Protégé.
We are considering either Texas or S. Dakota as our home addresss. Our Pa. truck registration ($150) comes due at the end of April an our trailer registration ($12) at the end of May. If we pay off the truck loan now (no problem) we might get the title before either date. I’m wondering about several things:
--If we pay those bills now would we have to reregister our truck in Texas or South Dakota before car insurance comes due (Sept. 11th) to get more moderate insurance rates?
--Would we also have to re-register our drivers’ licences to get that break?
--In either case, how do we go about it?
--Can we get the insurance breaks as soon as we change registration—without waiting until the insurance renewal date?
--I gather Texas is substantially more expensive than South Carolina when it comes to both registration and insurance but have no idea how big the difference might be. Does anyone have a ROUGH idea of what we might expect to pay in each on 2005 Dodge 2500 diesel given our age and driving records?
--We also pay almost $1,200 insurance with Foremost on our Bigfoot Trailer (love it!) that will be one year old in June. We bought the insurance through our RV dealer. Can we save much money there?
Why not call your current insurance carrier and tell them you are thinking about moving. Give them zip codes of the two places you are considering and they should be able to give you some quotes. Also online quotes are possible.
One item to consider. If your house is vacant, versus occupied, your insurance company may cancel coverage because the risk of a major fire is higher for a vacant house compared to an occupied residence. Read your Homeowners Policy about this potential issue.
Aramingo wrote: We don’t like the idea of renting it out to strangers though we might consider renting it out half the normal price to relatives or members of my wife’s chuch which would cover costs, maintenance and utilities.
You may assume giving someone a break on rent would get a good tennant. Someone who would keep up the property, pay the rent on time and in general not cause trouble.
In practice I've found the opposite to be true. Low prices appeal to the tightwads, cheapskates and others who don't have the skills to maintain a property. (And yes this group includes family and friends).
I agree it's better to have the house occupied. Not just for maintenance but statistically they say an occupied house sells better.
I'd think a better alternative would be to contact a realator to have them manage the rental. You could make it clear to them what your priorities are like security and property maintenance. Maybe insist on monthly inspections. In any case they could handle it better than you could due to your absence.
I apologize for giving this unscolicited advice. It just appeared to me that you might be headed for disappointment. Please just be aware you are vulnerable in this area.
Aramingo wrote: We don’t like the idea of renting it out to strangers though we might consider renting it out half the normal price to relatives or members of my wife’s chuch which would cover costs, maintenance and utilities.
You may assume giving someone a break on rent would get a good tennant. Someone who would keep up the property, pay the rent on time and in general not cause trouble.
In practice I've found the opposite to be true. Low prices appeal to the tightwads, cheapskates and others who don't have the skills to maintain a property. (And yes this group includes family and friends).
I agree it's better to have the house occupied. Not just for maintenance but statistically they say an occupied house sells better.
I'd think a better alternative would be to contact a realator to have them manage the rental. You could make it clear to them what your priorities are like security and property maintenance. Maybe insist on monthly inspections. In any case they could handle it better than you could due to your absence.
I apologize for giving this unscolicited advice. It just appeared to me that you might be headed for disappointment. Please just be aware you are vulnerable in this area.
I'm going to second the above. We rented a 2 yr old house to close friends (daughters God Parents) while working overseas, they moved out 5 months before we returned and there was a lot of repairs needed before we moved back in. Carpet, doors and total repaint. Needless to say, not friends any more. Use an Agent or sell it.
Aramingo - We find ourselves in a similar situation. House is listed with a Realtor. It is empty but "staged" for showing using strategically placed furniture and decorations in entrance areas. Home Owners insurance cancelled by insurance company because house was not occupied and basic fire insurance policy is costing us twice what a home owners policy did. Because of constant drum beat in the media about declining housing prices the few offers we've had on the house have been rediculous.
We are fortunate enough to be financially able to wait out the current crisis. Our Realtor is great. She visits the house weekly and keeps us informed on maintenance needs (mostly yard work). After 3 trys, we have a lawn maintenance guy who is reasonable, dependable and keeps things looking good. We also have someone come in once every 6 weeks to vacuum and dust.
Our only problem is that the house has been vacant for 2 years and after next year, we will have to move back in or lose the tax exemption on the capital gains when we sell. So, if we do move back in, we will have had 3 years of full timing that we enjoyed very much and we will be ready to hit the road again when this mess is finally over and the house sells.
I know every one doesn't have the same luxury to wait it out like we do but I firmly belive that the housing market is now like the stock market. Over time, if you don't panic, you will come out ahead.
Tom & Jan
Fulltimers since April '06 with 3 fur kids (George - mini Aussie, Archie - mini Poodle, Kitty - 20 yo blind cat)
1991 Beaver Contessa towing 2006 Subaru (4 down)
Started workamping Sept '07 - This isn't too bad. Think we'll do it some more.
Thanks for the responses. I'll try to respond to each in this one post.
Escapees--I've heard of that site and plan to check with them. It's likely we'll spend at least two to five months per year in Texas so it makes sense. Posts elsewhere suggest vehicle insurance if "very high" compared to S. Dakota. If "very high" means twice a rate that looks low compared to what we pay, it's not problem.
Getting quotes from current carrier: good idea.
Home insurance on empty house: Probably won't apply if we rent. I'm not sure if we'd be subject to that penalty since if we hang onto it we'd spend occasional time there--even if very intermittedly. Example: 3 weeks at present, 5 weeks in June and July. Possibly a month or so in the fall.
Goodman's point on possibly losing "Capital gains exemption" is a very good one that I hadn't thought about--perhaps the best reason for selling in some cases (Perhaps not ours since I'm not sure if we'd have any capital gains given the expensive improvements we put into this place). Are you saying someone who fulltimes and leaves the house empty would have two years or three years to claim the capital gains exemption?
re: You may assume giving someone a break on rent would get a good tennant.
People say its hard to get good tenants in this neighborhood (we could expect about $800 plus utils). That's why I'd consider CLOSE relatives (maybe as low as $190 month plus utils to cover property insurance and taxes) or someone from my wife's church but NOT friends or their children but not friends. In the second case, we'd ask a close to $500 and refund maybe $100 of that if there are no problems with paying on time or damaging anything.
re: Selling it for what I can get or at last year's prices.
Our place was worth close to $170K in the high market. We might go down as low as $149,000 but no further. It's better than the hit we'd be taking now if we had held on to our previous residence.
In 2004 we sold our duplex in Phily's Center City for a subtantial sum, bought this place for $58,500 and put more than 90 K into it--new electrical and Central air and lots of features we never had in the old place but always wanted--a sunny enclosed porch, brazilian cherry hardwood(instead of carpet), stone counters (instead of laminate), nice wood trim everywhere including crown molding and a nicer cellar with pantry.
We downsized in 2004 to enjoy the peace of mind that comes from eliminating all all debts and substituting low "carrying costs" for high ones. Thus, fulltiming is just further downsizing and life "simplification." The earlier move since it freed us free to spend on experineces we enjoyed while leaving the rest for more liquid investments than a home. So will this one.
We much prefer the superior internal amenities to what our old Center City townhouse had, along with the freedom to treat ourselves more without worrying. What we had previously was getting more like the Texas slogan, "Big hat, no cattle." Prices went so high later buyers must have been up to their necks in payments. We recently ram into some nice RVers who wished they had made such a tradeoff.
If we weren't so enamoured of the Hill Country and of we weren't so determined to full time, we'd NEVER wouldn't give up this place since the combination of amenities and low costs is hard to match and only five minutes by car to the Society Hill/Old City segment of Center City. We like CC Phily but we like the Hill Country and the freedom of going anywhere more. Heating costs for the winter are not much more than costs for one month in some of our friends homes.
With this place, we have no mortgage, low property tax and insurance ($150 month as compared to $900+ previously)and I get FREE public transport(my wife must wait until 65). I can take the elevated to l5th street or the Penn area of West Phily, get exercise by walking back to 5th St. or 2nd St, enjoy a leisurely lunch at dozens of good restaurants, take in foreign or American films at the Ritz Theaters with another senior discount before heading home.
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