Holding On Vs. Selling

[Brice Connors]

Greetings! 

So here is a predicament that I'd like counsel on. My wife and I recently purchased a new primary residence. This has left us with the townhouse that we had prior to our marriage. My question is should I hold the property and put a long-term tenant in the place? Or should I sell and realize my profit. Additional specifics below:

My wife purchased the property in 2020 for $160K. She put minimal down and utilized some state assistance to offset closing costs. If we put a tenant in the house we will have to pay the state back their $8,000 of assistance.

Loan Balance: $150K

Capital Required to Rent: $10K ($8K to pay out the state and $2K that I put into professional cleaning and new carpets.) 

Interest Rate: 4.25%

Years Left on Loan: 26

Estimated Monthly Rent: $1,750

Annual HOA Expense: $2,268

Annual Taxes: $1,746

Annual Insurance: $1,674

My concern with the numbers above is depending on capital expenditure projects and vacancy, we may not be able to cashflow. That said, I hate to lose the interest rate in this climate. The alternative is to realize a $100K profit and go track down other deals.

Open to all feedback and thoughts.