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Updated almost 9 years ago,
Do I turn my residence into a rental or sell and invest equity?
I am interested in getting into real estate investing and not exactly sure where to start. I bought a 1 bedroom loft in Orange, CA in 2008 for a great price. I put in a lot of top notch upgrades to make my loft Dwell Magazine ready. I refinanced about 6 months ago to a 10 year fixed conventional loan at 2.75%. So I only have 9 1/2 years left and the condo will be free and clear except the HOA monthly dues of $310.
I only owe $132,000 on the loan and a neighbor sold the same exact condo for $310,000 in April. The condos have been going around $268,000 and up.
My real estate agent said whatever I do don't sell it because I would make way more money in the long run by renting it out. I want to know if it makes more sense in selling it and making a $150,000 profit and divide that $150,000 and put it on two 2 bedroom condos and live in one and rent out the other or keep my condo for the next 9 1/2 years and have it free and clear and occupied by tenants. If I do keep it and start having a tenant rent it out how do I get a down payment for another property to live in now that I have a growing family.
All of the podcast interviews are with rental property owners in Iowa, Michigan, and North Carolina where it's normal to find properties for $50,000. Out in Orange County and LA County 1 bedroom condos in bad neighborhoods still go for $250,000. So I am lost on how to get started.