12 months ago we had the house appraised at $600k. Today it is appraised at $540k - $550k. So, if we had sold last year (commission $15k) and rented for $28,000 we would have had an average of $571k in the bank - say at 4.5%, $25,695, less a bit of tax, say $1,695, so we would be down $4k on the rent/interest equation. Then we would have saved $2,400 on rates, $300 on insurance, $500 maintenance, another $3,200. So the outgoings saving plus interest, less the rent plus r/e commission, has cost us $15,800 in year 1 of renting. But our property has fallen by $50k. we have saved $34,200, and if we bought the property back now, even with stamp duty we would be $16,500 up. If next year it drops another $50k, we will be almost another $50k better off, and still have the stamp duty money in the bank.
In my book, selling and renting for two years and then rebuying, resulting in being up $66,500 net of all costs is hardly foolish.
And if you have -ve equity, you'll be paying more in interest than you would in rent. Sell the house, cop the loss, and buy back after the market has clearly bottomed.
