Need help with 40+ cap property

[Sharee Paulino]

Hello again BiggerPockets, I have a Dilemma I would love to get some input on.

I purchased a condo in June of 2017.

All in with rehab, the cost was $75k (including furnishings).

It has been on Airbnb for nearly 2 years now.

After all expenses, (including management) the property nets around $3k/month (hands free) consistently.

It is a condo that has proven nearly impossible to (re)finance (due to mostly investor ownership in the community).

Now it has a market value of roughly $150k+. Even with the new valuation the property is still preforming at a 20% plus cap rate.

I would love buy 20+ caps (B class properties) all day, but the lack of leverage presents a problem when one is trying to scale.

I have however, been able to reinvest the cash flow directly into a couple small multi family deals.

On the other hand, In my market the extra $ down (from sale or refi) can absolutely get me a larger multi family deal (which is my desired trajectory).

so, the question is:

(A) Sell a 45+ %+ cap rate property (which truthfully makes me cringe), take the double up on investment and 1031 to a bigger deal.

(B) Keep property and scale accordingly via reinvesting cash flow + savings.

Or,

(C) Something I may be unaware of.

Any/all input would be greatly appreciated.