[Amanda]

My fiancé and I both have a house. For the last year I had my house on VRBO. It’s in a small city and while it’s not the nicest looking area, the house is nice and the street itself is safe. People that rent it are typically there for business, for something in the city or visiting family. Over the last year, minus expenses, I averaged about $500 profit per month.

It actually really hurt me tax-wise because I lost a lot of the breaks I received as a single mom, head of household, not living there last year. I wrote off as much as I could for expenses, but the profit for 7 months showed around $9k. I have only owned the house for about 3.5 years and I have around $97k to pay on the house.

My question is, since I am not profiting enough to quickly get the mortgage paid down, is it worth keeping? Or is it smarter to sell it and greatly reduce the mortgage on the house we are living in?

I am concerned about the housing market prices decreasing and the potential for the crime happening in surrounding areas to encroach the area where the house is. It seems we’ve had it engrained that real estate is a smart financial choice but I’m not sure in this situation.

Do we sit tight or sell? And if we keep it, what are missing in regards to tax write-offs? I did have a CPA file the taxes but are there CPAs that specialize in rentals? Lastly, how will getting married affect the taxes for a second home or taxes paid if we sell the house?

Thanks in advance!

I should also add that I am 38 and my fiancé is 43 so we aren’t a young couple starting the RE venture.

[Stacey]

I would keep it until married then sell. If something happens and the marriage doesn’t happen at least you’ll have a place and probably have a better interest rate than you could get now.

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