Should I rent or sell right now?

[Ethan Mckuhen]

Hello,

My name is Ethan and I'm new to biggerpockets. I've been doing some research and studying on real estate. Im a 25 year old firefighter that bought a house over two years ago and now that the market is doing well I'm not sure if I should hold or sell? I bought the home for 110k now the market is saying the home Is worth around 140k, I only owe 103k. Mortgage is around 750 a month, house is a three/ two one car garage on corner lot.

Any advice would be great, thanks!

[Jeff Stephens]

Hi @Ethan Mckuhen, and congrats on your entry into real estate! That is exciting, and you're now at a crossroads you will probably face many times in the future during your real estate career.  I think the only honest answer here is, "it is all relative to your goals, and depends on what you'd like to accomplish now and in the future with your real estate."  It's safe to say there are no right or wrong answers here; rather, it's more a question of strategy to help you get where you're going.

[BTW, I assume this is your personal residence--is that correct?]

Here are a few questions to ponder as you consider your options:

• If you were to sell this, where would you live? Would you want to buy again?
  • With your employment and income, would you qualify for a new home loan?
• If you were to sell, how much would you pay in commissions and costs (probably around $8k give or take), as those would eat into your profits substantially
• Are there other ways--like a HELOC--that you could tap into some of the equity you've built?
• What would you do with the "profits" you experienced? Reinvest them in more real estate? Spend it on something else? Reinvest in a different type of asset?
• If it hadn't appreciated, would you be wanting to sell it? Stated otherwise, is this the kind of property you think would be a smart long-term investment (good location, good bones, charm, etc.)?  
• How do you envision your real estate career playing out? Is this just the beginning of a huge portfolio of properties you plan to own? Do you want real estate to ultimately become your primary focus, so you can retire from fighting fires? Do you want to have a small handful of free-and-clear properties, or many leveraged properties? 

In my own personal real estate investing philosophy, I prefer to only sell a property if it's a really strategic move. While it can be tempting to want to enjoy a few bucks of "profit" on a house, I tend to personally take a longer perspective and hold onto things until it's really advantageous for me to sell it and move on.  

Good luck!