Long-term rental, know when to hold, when to fold

[Draic McClanahan]

Hello BP,

New to the forum - here is a go at my first post. I have had a long-term rental (10 yrs). 

I thought I was doing pretty well. That is, until I started reading posts in the BP forums. It has had a good run with appreciation up to now.  Maybe I could be doing better than just a forever hold - it looks like time to reevaluate and reallocate.

Here are some details:

Market: Sacramento Suburbs 

Value:~ $400K

Equity: ~$250K

Original Downpayment: ~$25K

Principal paydown: ~$7K/year (loan has 15 yrs left)

Price to Rent Ration: .47

Cashflow: $150/month

It had a good appreciation run over the past several years, however, the market seems to have plateaued a bit. After reading in the forum/listening to the Podcasts, there is more potential cash flow out there and the CoC based on the current equity is pretty low at this point.

Following the out of state investing process (ala David Greene), is it realistic to sell and take the equity to buy multiple SFRs in a better cash flowing market (KC, Atlanta, Raleigh?)?

Long-term goal is to have as much cash flow in retirement years. Any cash now would be used for reinvestment.

Any argument against not doing this? Eventually, current rental would be paid off and provide cash flow. But, it seems like splitting into multiple SFRs now would provide greater cashflow overall.

Just looking for a sanity check.

Thanks all!