Selling Your Home While Living Out of State or Country

Probably close to a third of my client base falls into this category and it goes something like this:

You bought a multi-family property or condo and used to live in Cambridge, Somerville or Medford. Then one of the following happened:

  • School ended

  • You got a job elsewhere

  • You married someone and moved away

  • You moved away to be closer to family

And you did the smart thing - you kept your property and either A) hired a property manager to keep things afloat or B) you managed the property from afar and found a way to keep things going for a little while or maybe a long while.

At some point, it becomes really difficult to manage properties from afar. Why? A few reasons:

  • 1. If you hire a property manager it can be really tough to find a good one. The property management business model requires LOTS of properties under management. The problem is, if you have lots of doors, usually your service diminishes.

  • 2. Even if your property manager is good, they aren’t the owners of your property. The reality is NO ONE will manage your property as well as you will. I haven’t found an exception to this one yet.

  • 3. Even if your property is well managed by a good company, it’s expensive. In the areas I work, I tend to see fees of anywhere between 5-10% of rents. If you have a 3-family property you could be paying $1,000/month in fees! That’s $12,000 A YEAR!

  • 4. If you go the self-manage route it can be very exhausting to deal with tenant communications from the west coast or from another country

  • 5. It can be tough to track down and manage quality contractors from afar. And what happens when you lose a trusted contractor?

  • 6. You never really know how things are going because you aren’t local

  • 7. Even if you fly back it can be a real pain. I have many clients that fly from California, Europe or Asia to check on their properties. Yes, I agree this is the right thing to do, but if you have a family and a job, how often can you realistically do this and how much time are you losing away from family and friends? 

I am going to spare you from continuing this list, which easily could have gone up to 20 items. You get the idea. At some point you’ll likely reach your breaking point and it will likely be time to sell. 

In these scenarios it really depends on what your longer term plans are. If you’d like to continue investing my general advice would be to 1031 exchange into a property closer to you.

If you don’t want to invest, I would eat the tax bill and enjoy the fruits of your smart investment.

Either way, if you are unsure what to do, give me a ring and I’m happy to talk through ALL your options!