Selling Home vs Cash-Out Refinance??

[Darren Chang]

Hi everyone, if I need cash for an investment project, which is preferred way to get it: selling a current property to get the cash, or keep the property, rent it out, and do a cash-out refinance? A few conditions are listed below:

- The existing property can be qualified as primary residence, and there will be no capital gain tax if sold.

- The existing property has a small mortgage left.

- If I rent out the property at the current market rate, the income is no enough to cover the refinance payment and the cash flow will be negative, assuming the refinancing amount is 75% of the home value and an interest rate of 3%

- There is a chance I won't get my rent income on time given NYC has suspended rent payment

- Given this apartment is in NYC and close to subway, there is a chance for appreciation over the long term.

Some insights into the pros and cons of the two approaches would be highly appreciated. Thanks in advance!