How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Richard Your Own Question
Richard
Richard, Lawyer
Category: Real Estate Law
Satisfied Customers: 53980
Experience:  32 years of experience as lawyer in Texas. I'm also a Real Estate developer.
17027240
Type Your Real Estate Law Question Here...
Richard is online now
A new question is answered every 9 seconds

My mom is 92 and in great health. She tells me she wants

Customer Question

Hi my mom is 92 and in great health. She tells me she wants to move closer to my sister in stockton ca. She owns a home in salinas ca. All paid for. It would rent for 1600 per mo. It's worth 265000 to 300000. Its in good shape. Rent in stockton is 700. What is best rent it or sell it. Also she has everything in a living trust. Thanks tim. Her son
Submitted: 1 year ago.
Category: Real Estate Law
Expert:  Richard replied 1 year ago.
Hi! My name is ***** ***** I look forward to helping you!
You're actually better off to sell the property. Because it's been her personal residence, she would have no gain on the sale because she could exclude it under Section 121 of the Internal Revenue Code. Once property is converted to rental property, the improvements tend to deteriorate more quickly as renters simply don't care for property like owners. And, although you would get the $1600/month in rent, you would likely have costs of leasing it (typical broker fee would be 1 months rent), and the costs of the house...property taxes, insurance, repairs, etc. In the end, you would likely end up with more money investing the sale proceeds than renting the property and you no longer have the risk of ownership.
Thank you so much for allowing me to help you with your questions. I have done my best to provide information which fully addresses your question. If you have any follow up questions, please ask! If I have fully answered your question(s) to your satisfaction, I would appreciate you rating my service as OK, Good or Excellent (hopefully Good or Excellent). I thank you in advance for taking the time to provide me a positive rating!
Customer: replied 1 year ago.
What investment would get anything close to 1600 per mo. Banks only about 350.a mo. She's 92 she can't risk the capital.
Expert:  Richard replied 1 year ago.
The thing is that you wouldn't likely be netting $1600/month because of the costs of the rental. And, presuming the house has some age on it, repairs are likely to be necessary, such as HVAC, roof, etc. that could eat up that monthly income. And, she's 92 years old. So, she could easily purchase an annuity at her age that would easily provide a monthly income of in excess of $4,000 for the remainder of her life no matter how long she lives.

Related Real Estate Law Questions