Please help - need advice on selling or renting a property

[Natalie Hahn]

Hi everyone,

Is a $1 million home (free and clear) that can rent out for about $4000-$5000/month a keeper or is it better to sell? It is a 3 bedroom SFH in a good location in the Bay Area, although it needs some repairs and is an older property. I've always heard that in the Bay Area it's better to sell, but then I'm also not sure if selling it and re-investing the money in a different place (like a multifamily not in the Bay Area) is going to get better returns or not. I've read that cap rates of 7% are considered good, but is that even realistic if you want good quality tenants in a good location?