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Updated about 8 years ago,

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1,888
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Jack B.
  • Rental Property Investor
  • Seattle, WA
1,045
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1,888
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Sell, hold, what to do?

Jack B.
  • Rental Property Investor
  • Seattle, WA
Posted

This was my first house, though it's 76 years old. I paid cash for it just over 6 years ago and have already made my money back from rents and the property has at least doubled in value from 60K to 150K. The deferred maintenance is adding up though. Three more new appliances soon, roof, paint, flooring, plumbing, etc. Plus it's really far away from where I live now, an hour drive one way. Huge inconvenience to go do stuff there.

I've held onto it for strategic reasons because it's a paid off place to live, I can be FI if I move back into it temporarily in hard times. However; although I like the general area because it's close to a lot of conveniences, I hate living on a busy street with traffic noise. It's not a main street but get's a lot of boom cars and motorcycles in the summer. Drives me NUTS. Also, while it's close to everything, it is in East Tacoma, WA, not exactly the nicest area.

Option A: I've thought about 1031 into another house that is paid off with cash on top for a bit nicer, newer place.  I'd likely have to add 30K on top.

Option B: I've thought about selling it outright WITHOUT the 1031 since I lived in it for 2.5 out of the 6 years I've owned it, and just paying the tiny capital gains tax for one year and depreciation recapture for the years it was a rental, holding the money for other opportunities. Can't be more than a few grand, maybe 3-5 times more than 1031 fees, but much more flexible.

Option C: I've thought about 1031 using the money to buy two leveraged houses like my other ones that are drastically going up in value. Only thing about this is, I've always liked to keep a paid off house as a fall back position; it has extreme utility in hard times, costs almost nothing to live when you have a paid off place and live in an urban core with ready access to transportation.

Option D: ? 

What say ye BP?

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