Sep 16, 2023 - Economy & Business

Return-to-office mandates force painful housing choices

Illustration of a ring of many keys and a man on a balanced scale of justice.

Illustration: Lindsey Bailey/Axios

Return-to-office mandates are forcing some Americans to move house. But that doesn't mean they need to sell.

Why it matters: If mortgage rates remain high, that just might be the reminder we need that renting is always an option.

Driving the news: One couple in Boise is selling their house at a loss of roughly $100,000 and taking out a new mortgage at a much higher interest rate in Seattle, where their employer is forcing them to work at least three days per week.

Between the lines: This couple doesn't need to sell — especially since, with mortgage rates where they are, it's a lot cheaper to rent than to buy in Seattle.

  • A Seattle house that costs $6,040 per month to own, in terms of mortgage costs, would rent for just $3,208 per month, according to Redfin.
  • The couple's Boise real estate broker, Shauna Pendleton, tells Axios that local homeowners with a mortgage rate of 3% or less can generally break even by renting out their homes, given how tight the rental market is.
  • Yes, that rental income is taxable — but all mortgage costs can be deducted before tax is paid, meaning the tax costs would be negligible.

The bottom line: Becoming a landlord isn't for everyone. But it can save a lot of money, compared with the costs involved in selling and buying homes.

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