Does it ever make sense to sell at a loss.

[Mike Boss]

Does it make sense to get money out of a poor performing investment to enter into a better performing investment if the sale results in a loss? 

I have a duplex with $70k invested into it OH. Way too much money put in repairs. The property was supposed to be for cash flow and the neighborhood doesn’t appreciate. Cash flow is $390/mo or 6.6% return. With the way interest rates are and the rural neighborhood it’s located at, I think it will be difficult to sell and get all my money back. 

I might only get $50k out of my $70k investment. 

I have an investment group I work with that does successful flips with 20% return over 3-4months. 

If I do one flip with $50k added to my fund for flipping I could make 20% on that $50k. I would make $10k. This is more than the $390/mo I’m making in the original $70k. 

However adding the $10k profit to $50k puts me at $60k. I still need to do one more flip over 4 months to get back to the $70k I had. 

The duplex I own with $70k invested seems like every month there's a new big repair and it's an old property. This is why I want out. I was originally supposed to have a 10%-12% ROI but now it's 6.6% because I keep having to put more money. And I can only sell it for so much because it depends on the rents. So everytime I put more money into it I think that I won't be able to get it back in the event that I sell. Makes me think it's better to get out now. I have a mortgage at 9% DSCR too.

[Travis Timmons]

@Alfath Ahmed you can stop copying/pasting these chamber of commerce stats about Columbus. We've all seen them 1000 times. It's not a boom town. It's fine. It's a growing midwestern city. Intel is a company whose stock is down 16.5% over the last 4 years while the S&P is up 65%. Google, Amazon, and Meta are investing all over the US. Cool.

You can cherry pick stats about any city. I'll take a swing at my market. Houston metro is the 27th largest economy in the world (just behind Belgium and ahead of Nigeria, in case you were wondering), has more small business job growth than any other city in the US, and since I moved here 13 years ago has grown by 1.7M people in the metro area. I don't know how big Columbus is, but common sense suggests that Houston has added the approximate population of greater Columbus in 13 years. Awesome. Who cares? Nobody is asking. People want to know how to underwrite their first deal or how to go about avoiding common mistakes. They can do a google search for stats and facts.

Stop selling, stop acting like everything is easier than it actually is, and do the blocking and tackling of helping green and naïve investors. I really am happy for your success. I'm not being condescending or patronizing. And the entire weight of this issue does not fall on you. I don't know a thing about you, but even you have to admit, there are a bunch of Ohio lurkers on here that seem more interested in grabbing their next commission check than actually helping people figure out how to navigate and succeed in today's market.