I want to hear from you about the “one that got away.” The rental house you shoulda bought. The income property you coulda kept. If you only woulda sold that investment property before all heck broke loose.
Pictured above is my old neighbor’s house. He sold his a month after me for $3,500 more than I had sold mine. Six years later it is for sale for $193,000 more than he sold if for! If you look at the chocolate brown house to the right…that was mine.
I like to keep track of my old neighborhood in Germantown, Maryland. In late 1998 I bought a townhouse for $109,000 during one of Washington, DC’s housing corrections in the Stoneridge subdivision of Germantown. When my life changed in 2001 and my wife and I decided to get out of DC to return to the Heartland I really wrestled as to whether to keep the house as a rental or to sell it and take my gains with me to help get me started in my new life.
To keep the house as an investment had upside. It was, after all, the Washington area and therefore real estate always does better there than just about every city in the country. Good jobs, great growth and everything. But the thing that kept coming back to me is that I might need those funds to help me re-establish myself and that 1,100 miles was a long way to be from a rental property that I owned.
So I put the house up for sale. I sold it in 4 days for $142,750. No house in our neighborhood had ever sold for that much and getting the appraiser to get on board was a challenge. But we did, I made $33,750 (before selling expenses) in just under 3 years. I was pretty proud of myself.
But I just had a nagging feeling about selling that house.
Even after the current housing correction that neighborhood is still selling in the $330,000 – $345,000 price range. At one point I believe it had gotten up to the $380’s or slightly better. If I had kept that house and sold it during the peak (and I had a good feeling that was the peak for this go around of the housing cycle) I would have made an additional $232,000. That would have been $29,500 a year equity growth without even counting principal reduction, depreciation and cash flow before taxes.
What is your story on the “one that got away?”