Would you hang onto a non-cash flowing California property?

[Andrew Neal]

So I have recently taken a job in Dallas Texas and was planning to sell my home in the east Bay Area. This job change and move was unexpected and we have only been in our home for about 9 months. It was not purchased with the intent of being a rental.

It will not cash flow and would probably be about $300 negative each month. I know tons of people will say just sell it while others will say "It's California real estate so just hang onto it".

I'm interested to hear people's opinions as to why they would or would not sell it.

*I can afford the monthly loss monetarily without it putting a major hindrance on my finances. I have considered renting it for now and just reevaluating the market each year to decide if we should keep it or not. The home is in good shape in a very desirable part of town.

[Keong Kam]

Here is my 2cents:

 - With rent growth it probably won't be negative in a few years.

 - If $300/mo negative is manageable for you, it's not a bad investment. People put more than $300/mo into 401K with stock market!!, I think you will come out ahead with less volatility in the long run compared to your 401K.

- Question is more of: do you have enough reserves to cover vacancies and some unexpected cap ex? Like 6-12mo of PITI? Having a reserve definitely puts more peace in your mind.

- With the combination of long term fixed leverage, I've not seen better risk-adjusted return elsewhere than the prime bay area real estate.

Hope it helps!