Return on Equity - Analysis and Strategy

[Andrey Y.]

I wasn't sure the appropriate subforum for this topic, since a few seem relevant.

I decided to calculate ROE on 3 properties I own in Oahu, Hawaii. I used exact mortgage balance and used in-building comps to calculate market value (all 3 are condos). I included all expenses, maintenance fees, and a healthy repairs reserve (which I have never came close to using in 4 years) to calculate net cash flow.

Numbers are below:

Property #1: Equity = $202,815 Net Cash Flow = $10,270 ROE = ~5.1% {~56% LTV}

Property #2: Equity = $103,284 Net Cash Flow = $6,109 ROE = ~5.9% {~57% LTV}

Property #3: Equity = $90,588 Net Cash Flow = $2,475 ROE = ~2.7% {~61% LTV}

What do you guys think of these ROE numbers? To me they seem quite low (especially the 3rd property). Do you recommend selling, maybe 1031 into an apartment building somewhere else? 1031 into several SFH rentals, geographically diversified? Stay put?

I am open to selling the second and third properties. The first, probably I will never sell because its in a desirable area on the beach. Would you refinance any of them?

I listed the LTVs above. I actually realized, I am under-leveraged for my level of risk (I think?). Thank you for reading.