Avoid Becoming A Long-Distance Landlord

Emma is debt-free except for her mortgage. She's applying for graduate school. The program will be $56,000 a year, and it's two years in North Carolina. What's the best thing to do with her house now?

QUESTION: Emma in Atlanta is debt-free except for her mortgage. She’s applying for graduate school and has been working for four years after leaving the Peace Corps. The program she likes will be $56,000 a year, and it’s a two-year program in North Carolina. What’s the best thing to do with her house now?

ANSWER: Basically, you’re asking me if you need to be a long-distance landlord while you’re doing your grad work. No. Let’s pretend you didn’t own the house and you had all of this lined up. Would you go buy a house? That’s what’s running through my head. I think you’re keeping it just because you’ve got it—not because it’s part of a plan. You’ve got everything else planned out so well and so thought through. You’re executing your goals step by step by step, and this thing could end up being an anchor around your neck that’s not pleasant. I would sell it. I don’t see any reason to own it. You’re not coming back to it. You wouldn’t do an investment in this scenario of this type. We wouldn’t buy a house because maybe your sibling would want to stay there. You’re gone five years—two years of grad school and three years of foreign service. So buy something when you settle down, so to speak, when you’ve got a predictable area that you’re going to live in for an extended period of time—or don’t until you do. If I were in your shoes, that’s why I would sell it because I wouldn’t buy it if I didn’t own it, which means it’s time to sell it.