My Rental Income

So I was reading this blog today http://wellheeled.wordpress.com/ and it got me thinking.

So today I was remembering when I had to chance to sell my home for 206,000 back in 2007. Everyone told me that I should keep it and rent it out. Everyone really didn't mater but my mom said I should keep it and since she gave me most of the money for the down payment back in Feb. of 05, I went along.

Ok profit from renting is about 300 a month is about 3600 a year. So what happens when it is not rented for two months or when I have to make repairs that profit is Gone with the Wind.

at the time I was selling I owed about 138,000 (206000-138000= 68,000) so I’ve never sold a house before so I am not sure what I would walk away (I know I can look it up but maybe Justin knows) but lets say I would have 40,000 after I gave back moms money from down payment.

So what is 40000 at 5.25 after 5 years (CD rate at the time) 52006-40000=12006/5 = 2401 a year before taxes (With no stress of tenants).

To tell you the truth I need some comments on if my theories or thinking is correct but I really rather have to worry about the low interest rates when I am renewing my CD rather than trying to pay a mortgage at a house that is not rented and that I am also not living in.

So I guess the moral is if you know deep down you feel certain way about a situation just do it. If it fails you won’t have any regrets.

Btw I might have invested a large portion of that 40K in the stock market and I might be upset right now but like they say hindsight is 20/20
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