Should I sell my duplex?

[Charlene Fetzer]

Alright, I thought I would throw this to the group to see thoughts.

I bought my first investment property in March of 2020 (crazy timing) for $229,000/$69 sq ft in Nashville TN. Extremely hot market. It is a duplex and half was in terrible condition. I used hard money to reconstruct unit A and unit B was in good condition (still needed work but not as much). I refinanced (not a cash out refi) for $270,000.

Now, with forced appreciation and natural appreciation it’s likely to sell upwards of $600,000.

I have rented unit A for $1860 a month gross ($1704 minus PM) . The PMTI is currently at $1793. I also live in part of unit B. I also Airbnb a private room at about $1200 net. I did not intend on living in unit B but with covid then breast cancer it provided me a almost free space to live (I didn't Airbnb during cancer treatments). So yes, this house is cash flowing well. I'm not including CapEx and on going maintenance at the moment. And I have the permit to fully Airbnb at likely $2500-3000 monthly on top of Unit A tenants.

This all sounds great, but the property still needs a lot of work. The backyard needs to be excavated, I need to install ductless or central in unit B. New toilets. To make it Airbnb worthy in my competitive market a bathroom likely needs to be rehabbed. Honestly to really make it great would be more than I’m willing to fork over for one property. Also, I’m watching the foundation. When I purchased it I had to install new footers and gut both bathrooms out, new joist etc. There was a 4in slope in a span of 8 feet in the front room. At that time I didn’t have $20-30 grand to just put Into the foundation. I did what I need to make it safe for tenants and would watch it for the next couple years.

I work contract jobs and banks hate no traditional work. It’s extremely difficult to get a heloc (trust me I’ve tried). Even the cash out refi has been excessively difficult and ultimately shut down. because of covid then breast cancer my last two years of tax returns are all jacked up, so the banks aren’t keen on me. My strategy was always buy and hold and this is my first investment. I rental arbitrage another monthly Airbnb in my market too. I could use the money to take some time off and travel and buy another property. I don’t want to be short sighted but also see the market is still a sellers market and investment properties are hit in Nashville. I started investing to create time freedom. Since cancer I see time even more valuable and the house has created more stress.

Curious on what you may do? Hold or sell?