Should I Sell or Keep As Rental?

[Uchenna A.]

I recently moved from a 4BR 3.5BA townhouse in Bowie MD. I bought this house in 2013 for 280K and PITI + HOA is ~1700. I owe ~200K on it and initially listed it for sale for 370K. I have had two contracts fall thru for job loss & financing issues. The max rent I can get on this property is around $2500. My initial reason for deciding to sell is because I have a property I bought in a short sale last year close by for 183K renting for $2600. It's hard to stomach a house worth twice as much renting for less.

So my question is - should I rent or sell this property?

[Ray Slack]

The Bowie Market has taken off over the last 3-5 years.. You will be VERY lucky to find anything for under $300,000 that rents for $2,500. You can't compare one lucky home run short sale you got a couple of years ago to today's market.  You have about $150k in equity in the house (after selling costs) You are netting about $9,600 positive cash flow by renting it out. (not including V&C or management)  Which is about a 6.5% return. (Not including future appreciation and paying down your mortgage)   Unless you have have somewhere to put the money that you can earn a higher return keep it as a rental.