To sell or not to sell? That is the question...

[Patrick McGrath]

So I have a property that we purchase in 2013 for $195k that we lived in until 2017 and then turned into a rental. We took out a HELOC and used that to purchase rental #2. Then earlier this year we refinanced it, paid off the HELOC and it appraised for $290k. With the current housing market if we put about $5-$8k into we can sell it for $310-$320k. Current tenant is moving out next week.

Currently Mortgage = $1525 PITI @4.875%

Spend $2k to get it rent ready and New rent would be $2100

Gross profit = $575 - $315 = $260 Cash Flow.

Question is should we sell now since we lived in it 2 of the last 5 years and pay no capital gains which would net us $60-$70k.

Or refinance to 3.5% adding an additional $150/month cash flow, bringing it to around $410/month.

Appreciate your insights and thoughts.

[Juan Pardo]

Originally posted by @Patrick McGrath:

So I have a property that we purchase in 2013 for $195k that we lived in until 2017 and then turned into a rental. We took out a HELOC and used that to purchase rental #2. Then earlier this year we refinanced it, paid off the HELOC and it appraised for $290k. With the current housing market if we put about $5-$8k into we can sell it for $310-$320k. Current tenant is moving out next week.

Currently Mortgage = $1525 PITI @4.875%

Spend $2k to get it rent ready and New rent would be $2100

Gross profit = $575 - $315 = $260 Cash Flow.

Question is should we sell now since we lived in it 2 of the last 5 years and pay no capital gains which would net us $60-$70k.

Or refinance to 3.5% adding an additional $150/month cash flow, bringing it to around $410/month.

Appreciate your insights and thoughts.

I would sell it and wait for the very likely correction of real estate prices to find another opportunity.