What should I do? Sell or continue to own a cash flow condo?

[Byron Enamorado]

Hello bigger pockets members!

I’m seeking some advice. I purchased a condo in West LA in 2013 for $500,000 and now it’s worth about $680,000. I moved out of the condo last year to purchase a townhome, also in West LA. I converted the condo into a rental property. Rent is about $3,000/month and it cash flows about $400 per month. I’m loving being a small business owner and learning lots about real estate. I want to purchase more real estate and my next goal is a multi-family in West LA. Should I continue owning the condo or sell? If I sell I’ll get about $270,000, what should I do with the money? If I keep it, for how long? Any advice or options would be greatly appreciated. Thanks in advance. 

[Bill Exeter]

Hi @Byron Enamorado, 

It sounds like you have owned the property and lived in the property as your primary residence for at least two years out of the last five years, so you would qualify for the 121 Exclusion ($250,000 tax-free if you are single, $500,000 tax-free if you are married).

You actually have a three year window after you moved out of the property during which you would still qualify for the 121 Exclusion.