Found myself paralyzed, undecided on how best to proceed and wasting too much time thinking about it. On the positive side, I have potentially stopped the cash bleeding by renting out to a top quality tenant. On the negative side, that was 2 months of unnecessary cash burning and dipping into my investment account that I’d rather not have been doing. Now, I am just waiting for the huge tax hit that should arrive in the mail any time now… the whole time, I was dreaming about buying an iPad with the first month’s rent.
Alas, my prudent calculation tells me that half of the rent will be eaten by maintenance costs while the rest should be saved up in expectation of this huge tax hit. So, there goes about 6 months of rent after which there’s only 4 months of rent left in the year. So really, the funds available to me is a lot less than my original fantasy made it out to be. Makes me wonder what everyone else is thinking in their frenzy to buy their overpriced houses? Back to me. I have 3 scenarios that is playing out in my head.
Scenario #1: Go batshit crazy with renovation with the rest of the house. Then rent it out. This includes hand sculpted hardwood floor, interior brick veneer. New kitchen cabinets. A door, new caulking a new bed +frame, landfill fees for dumping and some sliding book cases. I estimate that just the material cost alone will take about 3 years worth of rent. I will have to learn and do the manual labor. All the while, mowing the lawn and taking care of a too big garden.This should double my rent income and allow me to move to asia with a lower living standard to build my business. Downside? It’ll take 3 years of rental income to make up the cost.
Scenario #2: Refocus back to the tech business right away. Which means that I perform the minimal repair of adding a door and new caulking as well as paying for landfill fees. The repairs and cleanup should take about 1 months and I expect the rental income to cover the expenses evenly. Selling the more valuable items would take longer and spread out over time, hence provides a distraction.
Scenario #3: Forget the repairs and dumping, leave everything as is and get back to my main focus in tech right away. Although I’d really love to do this, the mental strain of a messy and disorderly environment is not conductive to my focus. I know because I’ve tried last year. It’s like having a bubble of zen that’s slowly being eaten away at the edges by ants. It defies my principle. If I am sure that the business will succeed, then I’d focus on this, but at this moment, I am not sure.
Writing it out really makes it seem that #2 is the right choice. For the next month at least, I don’t have to decide and should have more data on the actual maintenance costs. So dumping garbage, selling on Craigslist, door and caulking should be my main concern.