Posted by Bill S. (Ohio) on January 23, 2002 at 05:34:03:
Ask yourself why the property values are declining. For each reason, there is a plan of action. For example, if the local economy is lousy because businesses are leaving and no one is buying and you have a flooded market----maybe you should just bite the bullet. Ditto is the area is turning into a war zone and that’s why no one wants to live there.
If it’s just the national recession slowing things down, just hang in there and wait. As long as you can cover the monthly holding costs you can wait out any recession.
I know that you are in a more secure possition getting the deed, but what if the prices of homes arent increasing and may even go down in your area? Are you better off just doing a L/O? What would you do if you had a property sub2 and the value of the home decreased dramatically? Do you just bite the bullet?
If you have positive cash flow and the property is worth keeping for several years, don?t worry too much about the value going down for a year or so. You can sell sometime in the future for profit and have tax benefits in the mean time, you have done just fine.