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Updated over 6 years ago,
Pros and Cons selling versus refinancing
Hi all, I've been reading the website and listening to the podcasts for about a year now, and I want to get into the real estate investing as a major part of my overall strategy. But I need help getting that kicked off, and I have a big decision to make regarding my condo.
Currently, the only property I currently own is a 2 bed/1 bath condo in Chicago. I purchased it September 2013 for 225,000 with 20% down with 4.5% interest, and it has been my residence for the past 5 years. I put it on the market in the spring hoping to make some money off of the purchase and taking that to purchase a multifamily. I've had no offers, with interest seeming to have really died off lately. I'm currently listed for 255,000, which is what it was listed when I bought it 5 years ago. My realtor suggests lowering it another 10% to bring it 230,000.
So my question is, at what point is it better to refinance cash out and rent it than to sell it for what I bought it for? Not that this is completely accurate, but my latest tax statement has it valued at 270,000. If I refinance and it appraises in that ballpark does it make sense to do it? From what I see with my current monthly payments and the average rents for 2/1s in my neighborhood I would break even renting.
Any thoughts or suggestions are greatly appreciated!