Sell the house or keep it as a rental?

[David Kimball]

Sell the house or keep it as a rental?

Curious to get the group's thoughts.

We are moving and have already got another house. We were going to sell our current primary residence, but are having a hard time doing it with interest rates in the 6%+ range, so we decided to give rental a shot.

Last it was appraised at 460k, our mortgage is on a 15-year fixed with 2.75% interest.

Monthly payments (incl. escrow for tax and insurance): 1830/mo

Property insurance will go up $500/mo as soon as we don't have the homestead exemption.

In my estimation, we can rent it out for $2100/mo and will have to put in new carpets and a fresh coat of paint.

We tried listing the house for $450k - no interest. Offered special financing with seller rate buydown - no interest.
I'm curious how to think through whether we should keep the house as a rental, or try to sell it by lowering the price.

Our remaining balance is 135k on the mortgage.

[Robin Simon]

Quote from @David Kimball:

Quote from @Jeremy Nault:

Hi David, 

The Numbers seem a little tight to work as a rental.  You mentioned that the insurance would just to 500 a month after you move, would that increase the 1830 or is that number already taking the increase into account.  

The biggest question that you need to ask yourself is if you didn't already own it, would your purchase this house to use as a rental property? If the answer is no I would sell, if the answer is yes I may hold onto it.  

I hope this helps! Good luck with your decision!

 Yes for sure. I would sell it, I think my main question is... how low to go to sell it now vs., keep it afloat for a year or two until valuations are back up (if).

 Is the property in Austin?  If so, I'd think about keeping it even with mediocre cash flow considering you've got a good rate/mortgage