Moved to a house, rent or sell old townhome??

[Nate Hansen]

I've got a quandary that I'm stressing out over... rent or sell our townhome after moving to a new house.

I've been excited to move to a house and have my first rental, but as I'm assessing the numbers/other factors I don't know if it's right for a rental.

The mortgage on the townhome is $1400/month with $150 HOA. It's 3 years old and is a modern, kind of fancy place that we paid a high price per square foot to get into. And I think that's the problem. Based on other rentals around the same size in the area, it looks like it would rent for $1,600 a month, and I think absolutely best case scenario, $1,800. One realtor told me I could rent it for $2,000 a month, but I just don't see that based on comps in the area.

The other factor is, I have a good income, and thinking through the hassle of renting to MAYBE make $100-200 a month doesn't seem worth it. On the other hand, the renters are buying that investment for me... but 27 more years is a damn long time for that to payoff.

As far as selling, we owe $235 and the same realtor told me it would sell for $285k to $295.

So now as I'm thinking about it, getting ~$40k immediately by selling is sounding better and better.

I guess the third option... rent it for a few years while the market hopefully keeps going up, and sell it while the place still seems nice and new.

I would greatly appreciate any insights, thoughts, advice.... Thanks!

[Mike Dymski]

With the figures provided, you will not make $100-200/mo, you will be upside down when you include vacancy, maintenance, cap ex and management (should include management whether you self-manage or not in case you move, can't manage and just to benchmark versus other investment opportunities).  Feel free to run the figures through the rental property calculator on BP to provide a visual.

Your appreciation estimates and support for it are not included here; so, this feedback is based on cash flow.