Tenants moved out. What should I do with the property?

[Ted Esposito]

This was my first home (3/2 SFH) which I purchased in 2016, lived in as my primary through 2019, and then turned into my first rental property (I bought another house to move into). Mortgage is $1300 and income was $1800. Currently sitting empty. The local market (Florida) is going through a big housing bull market (and higher than average inflation at 8.5%). A lot of people are moving from California, the midwest, and northeast. There are a ton of investor rehabs, flips, and rentals (25% of buyers here are investors, many out of state).

I purchased the house for $189k at 3.875%, still owe $154k and could sell as-is for $325k. If I sell before 2023, I could avoid capital gains tax because I lived in for 2 of the last 5 years. The condition is okay, the bathrooms and kitchen are outdated from the 60's and the roof is approaching the end of its life. So here are my options:

OPTIONS TO SELL

1. Sell as-is, as soon as possible ($300k-$325k)
2. Remodel the kitchen and bathrooms (~$20k?) and then sell ($325k-$375k)
3. HELOC and use it for #2
4. With either option, I could walk with no cap gains tax, or attempt a 1031

*If I sell, I'd walk with maybe $150k to put towards another property.

OPTIONS TO RENT

1. Rent as-is, as soon as possible ($2000/mo)
2. Remodel the kitchen and bathrooms (~$20k?) and then rent ($2300/mo)
3. Cash-out refinance and use this for #2 and have another $80k for another property
4. With either option, I'd be losing the opportunity to sell with no capital gains tax if I continue renting it in 2023.