To Sell or Not to Sell...That is the Question

[Leo Gutierrez]

Hi everyone, I have a dilemma concerning our primary residence. My wife and I are I'm trying to "jump start" our REI journey with the long term goal of generating enough cash flow/passive income within 5-7 years to use as our main income source. We own two SFH...Propery#1 is a rental which we purchased when we had NO CLUE what we were getting into about 14 years ago- (currently rented but we're getting ready to sell it after doing renovations once the tenants move out at the end of Sept)- we owe $168K ...will put in about $20k out of pocket for Reno and estimate we can sell for $275k- $285K). Property #2 is our primary residence which we've owned for 16 years...we owe $178k and can sell pretty much as is for approximately $350-$370 OR we could hold it and rent it out- for $2,500/mo...after running some numbers we 'd have a NET cash flow of about $200 which would be a good start towards our long term goal. Before you suggest a cash out refi or HELOC, know that I've tried both of these and have struck out due to my high DTI ratio (we're a one income family) and/or a ding on my credit history (even though my credit is in the mid 700s) But instead of making this post even longer with all those details, here is my question...Should we sell our primary residence and tap into equity that way OR should we rent it out even though there is all that equity sitting there which we could really use to start acquiring more properties? Any input would be greatly appreciated!