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Today's inquiry is distinct.
There’s something significant about it— and you’ll see why shortly.
An 84-year-old listener reached out to us via voicemail about his challenge with mortgage debt. He and his 83-year-old wife are looking to move from their two-story townhouse as they can no longer manage the stairs.
They discovered a single-story ranch house that meets their needs perfectly, except for one issue: it comes with an overwhelming $4,200 monthly mortgage payment.
They do have one possible way out of this debt: selling their Florida condo, a vacation home they haven't used in years due to escalating health issues.
However, Hurricanes Milton and Helene severely damaged their building last year. While their unit was spared, the lobby was destroyed, and their car was submerged in floodwaters. This damage led to a rapid $100,000 drop in their property’s value.
Now they are confronted with a tough decision: Should they take this substantial loss and sell the condo to relieve their debt? Or might selling now, after such a significant decline in value, solidify their losses?
Joe and I have addressed countless questions from our listeners over the years, but this one is especially significant. It's from my Dad.
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Here’s the complete transcript of my father’s question:
Hi Paula and Joe,
I’m Prahlad, 84 years old, and my wife is 83. We currently reside in a two-story townhouse in Atlanta and own a two-bedroom condo at the beach in Clearwater, Florida.
Recently, we bought a single-story ranch home in Atlanta so that we can avoid the stairs at our age.
Our condo in Clearwater is located on the 9th floor of a 14-story building. We cherish the condo with its views of the Gulf of Mexico and the Bay, but we haven't been able to visit it for a while due to our health issues.
We bought the condo for $400,000 in 2015, and it was valued around $800,000 in 2022. Now, it's estimated to be worth about $775,000 in Spring 2024.
As you may know, this area experienced the impact of two hurricanes, Helene and Milton, last September and October. The building's lobby was flooded and sustained major damage and is still undergoing repairs. The covered parking area was also flooded, resulting in our car being totaled. Thankfully, our condo remained undamaged.
Since the hurricanes, there hasn’t been much real estate activity in the neighborhood. My real estate agent now estimates the condo's value at $700,000.
The building has been planning a significant renovation of the plaza deck for a few years, and we or the future owners may face a large assessment—possibly around $30,000—for this renovation.
We hoped to sell the condo to pay off the mortgage for the ranch home we recently acquired in Atlanta and achieve debt freedom.
What do you think — should we sell it now or wait until a later date — perhaps until next year?
We would greatly appreciate your guidance. Thank you both for your work.
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