Should I rent or by a rental? ( Ugggg so confused )

[James Stayton]

So I am just going to throw the situation out there and see what opinions people have.

I'm in my early 50's and I am a single dad. I moved from California to Washington state. I kept my Ca home and have it rented out and make a small income off that every month. 

This summer I am headed from Washington to Tennessee. Because of the drastic price difference I am in a place where I can.

A) Buy a home there for my daughter and I with enough down it would be a very small mortgage payment and have it be our family home. 

b) Buy a place as a rental income property. I am debating on a 2nd home or vrbo but the only difference I see is more down and a percentage rate. 

According to the mortgage company I have the credit for it now and I have been good about saving money. My daughter and I live pretty simply and I know that prices will increase on a steady pace in Tennessee. The dynamics of a lot of people are wanting to leave major metropolitan cities. As with everyone I love equity. I own a small technology company that has been not had an issues with Covid and my income is the same no matter where I live so no loss of cash flow. 

I had an informal talk with a RE agent back there that is sending me a number of homes, townhouses, single family units and some lake front property he said local investors have been buying. As I write all this down suddenly I think .... wait, what if I look at a duplex or fourplex. Help, my brain hurts with possibilities. LOL

Any opinions are appreciated :) 

[Travis Jacobs]

I would analyze the numbers on your property in California and see if it's actually cash flowing after reserves for the rentals expenses. Consider the tax hits of selling it or keeping it. Personally I wouldn't want anything to do with California for tax reasons, but some have success there. I would then consider buying a Duplex or Quadplex in Tennessee for sure. Say you get a Duplex you could get a 2-3bd on one side giving room for you and your daughter and rental income on the other side to cover the mortgage and some expenses. Having a 4 plex would give you more options and security in my opinion as you can live separately easier with having the mortgage still covered if you wanted. I do not know the numbers of your CA property and when you bought it, but if it was me I'd sell and re-invest it if it made sense to. It's great to repurpose your money to make it work harder for you without as much effort! I'm in Chattanooga right now but plan to move north up to Knoxville, TN area but I'm also looking at other areas of TN as well. Best of luck to you!