Hey guys, I bought a townhouse back in 2021 and lived there for two years before I started renting it out this year. Thankfully, I didn’t face any major repairs while living there—just some minor updates since it’s an older place from the 60s. This past summer, though, I had to replace the HVAC, which drained my savings a bit. Now I’m worried about covering any future big expenses without getting a loan. I’m thinking about selling, but I want to manage my expectations. I’ve seen estimates that my home is worth about 30-40k more than what I paid. I’ve never sold a house before, so how does this all work? Do I need an appraisal before listing? What should I expect in terms of profits, taxes on capital gains, and agent fees? Any advice would be super helpful!
Definitely get an appraisal before listing! It’ll give you a better idea of your home’s current value. Also, you might want to check out what homes are selling for in your area.
Axelle said:
Definitely get an appraisal before listing! It’ll give you a better idea of your home’s current value. Also, you might want to check out what homes are selling for in your area.
Yeah, I’ve heard that too. It helps to be realistic about your asking price.
As for capital gains, if you sell for more than what you bought it for, you might owe some taxes. But since you lived there for two years, you could qualify for some exemptions!
Oli said:
As for capital gains, if you sell for more than what you bought it for, you might owe some taxes. But since you lived there for two years, you could qualify for some exemptions!
What kind of exemptions? I’m not sure how that works.
@Ember
If you lived in the home for two out of the last five years, you can exclude up to $250,000 of gain if you’re single, or $500,000 if married. So you might be in a good spot!
You should also factor in closing costs, which can be around 6-10% of the sale price. Don’t forget about agent fees too!
Zane said:
You should also factor in closing costs, which can be around 6-10% of the sale price. Don’t forget about agent fees too!
Ugh, that adds up. Do you know if there are ways to reduce those costs?
@Zane
You could try selling it yourself or negotiating with the agent for a lower commission. Just depends on how comfortable you feel with the process!
Honestly, if you’re worried about future repairs, selling might be a good move. Renting can be unpredictable too!
Amani said:
Honestly, if you’re worried about future repairs, selling might be a good move. Renting can be unpredictable too!
That’s true. I’ve dealt with some unexpected costs as a landlord and it can be stressful.
Just remember, selling can take time. Make sure you’re ready for the process and have a plan in place for your next steps!
Tobi said:
Just remember, selling can take time. Make sure you’re ready for the process and have a plan in place for your next steps!
Good point! It’s not just about selling; you need to think about what’s next.