Rent out or sell half of duplex

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copodenieve
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Joined: Fri Mar 09, 2018 6:14 pm

Rent out or sell half of duplex

Post by copodenieve » Fri Mar 09, 2018 6:57 pm

Hello all, I am brand new to this forum, and looking for some insight to a real estate situation. My parents have been permanent residents of Chile, living in Rancagua, for more than 25 years (I live in California, but am able to spend a few months at a time here in Chile to help out). My father passed last March, and as a result my mother's income has dropped significantly (she receives U.S. social security).

My mother owns both sides of a duplex, and we are trying to figure out some of the benefits and disadvantages of renting it out vs. selling. Obviously, her personal situation is critical for making such a decision, but I thought some of you might have some helpful insight. As best I can tell, the housing market is rather soft right now, but since I do not live here I am having some trouble getting a good initial overview of the situation.

My mother is bedridden and no longer able to engage with this issue intellectually. I have a RUT, am in the process of getting my permanencia, and have a mandato general (broad power of attorney) from my mother. My Spanish is good.

I wonder if forum members might have some advice for how to start on this process or otherwise help point me in a useful direction. Any help would be very much appreciated!

StrawberryHeartsForever
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Re: Rent out or sell half of duplex

Post by StrawberryHeartsForever » Fri Mar 09, 2018 10:38 pm

First of all, sorry to hear about your father. Second, I think the best thing would be to rent out. In Rancagua, would the money you got in a lump sum for a house there mast that long? At least renting would mean a fixed monthly imcome. Also, this housing market is just going crazy at the minute in terms of prices. If the same happens here as did in the UK for example, prices will just go up and up, even of you think they are already expensive. My husband bought his 2 bed appartment in Santiago 10 years ago for around 20,000,000 pesos. The value is now worth triple, just to give you an idea. Those price rises are now also being seen outside of Santiago. The best thing would be to find a trustworthy intermediary to sort out all the details and such. If you sold, that decision would be final, no going back. But now I do not see a housing crash so drastic that you would lose anything by sitting it out and see what happens and rent in the meantime. That is my opinion though.

Good luck!

StrawberryHeartsForever
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Re: Rent out or sell half of duplex

Post by StrawberryHeartsForever » Fri Mar 09, 2018 10:39 pm

Oh and the best person to consult is admin who offers legal services and I am sure will be along shortly to help.

copodenieve
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Re: Rent out or sell half of duplex

Post by copodenieve » Sun Mar 11, 2018 4:35 pm

Thanks for the insight, Strawberry Hearts. I think I am inclined to proceed as you suggest, and start familiarizing myself with real estate prices so that I can act in a more informed manner. I'm happy to have found this forum. Seems like lots of good information to be found here.

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tiagoabner
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Re: Rent out or sell half of duplex

Post by tiagoabner » Sun Mar 11, 2018 6:55 pm

I'm sorry for your loss. The best course of action depends on multiple variables, such as:

- Does she have other properties?
- Is she going to continue to live on Chile?
- You mentioned she's bedridden. Are she currently suffering from a medical condition that would involve high medical costs and/or low expected lifespan?
- Are there other heirs involved?
- Did your father had any insurance policy that she could cash in?

Now, I'm not a financial advisor and this isn't meant to be interpreted as financial advice, but with this info it might be possible to know more about your situation. Guessing whether selling or renting is best without this info would be a wild guess that would, at best, consider only the financial perspective.

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admin
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Re: Rent out or sell half of duplex

Post by admin » Mon Mar 12, 2018 7:11 am

Just based on the details given (which is very thin), but sense would be sell it and then put the money in something that will give her a nice steady income for the rest of her life. You can get an idea of what the prices are today fairly easily. Knowing what the the prices will be in say 10 years is gamble.

Again, lot's of variables; but, unless your planning to be there to manage it and so on, renting is a lot of work.
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Putenio
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Re: Rent out or sell half of duplex

Post by Putenio » Mon Mar 12, 2018 9:11 am

Thanks for the post and insight - we've heard it is a lot of work.

We've examined investment properties (apt/house) and I even met with someone in Sntgo who manages a large portfolio of properties, and his advice was - unless you can really screen who you rent to, full financial background check, references, etc. and you want to the landlord work - buy/sell.

We've heard - and would like to hear from anyone who has actually rented long term (1yr+) - that the laws in Chile seriously favor the renter, that even when they do not pay it's quite a long and expensive legal process to evict, that the judges usually favor the renter over the big bad well-to-do owner, and that at the end of the day, it's more hassle than it is worth.

Is there any truth to the sweeping generalization that laws and the system favors renters?

Interested to hear experiences on this topic.
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at46
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Re: Rent out or sell half of duplex

Post by at46 » Mon Mar 12, 2018 10:35 am

Long-distance rental will not work in Chile, so sell and use the money elsewhere.

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