Updated about 8 years ago on . Most recent reply
Selling rental property
I am debating about selling my 70 year old duplex in Los Angeles and buying 2 newer houses in Indianapolis. I owe 324k and after all expenses are paid I average about 7k a year profit (rent is $2,700 a month). The houses I have been looking at, cost between 100-130k and rent for $1100-1250 in Indy, not including management and other expenses. Also I would be able to buy one with cash and probably put more than 60% down on the second property. The only drawback for me is that L.A. has high rents and would be a great property when it does get paid off when I'm 57yo. What do you think?
Most Popular Reply
Why not milk it for all its worth. Instead of buying 2 houses, go down in price and buy houses ranging from 75-90K in purchase price. That way you can have 2-3 paid off houses or 3 paid off houses and 1 with a high down payment. You can cash out refi and buy even a 5th property.
Since the houses you buy in Indy will be paid off, its almost all profit. If you buy a SFH in Indy you can easily rent them for $800-$900 a month. If you hire a PM, with 10% per unit, its only $90 you will be paying a month per unit for maintenance.
Personally, I would rather invest in Indy than Cali any day. The amount you are paying to maintain 1 unit in Cali is equivalent to the amount to maintain 4-5 units in Indy. Its a no brainer on which to choose I feel.