I own and self manage six multifamily properties in Providence, RI, acquired between 2008-2013 at great prices, with less than $50K in total debt remaining. These investments have yielded high returns because I bought them foreclosed and fixed them up myself. While I really lucked out on these purchases, the yield on them left me a little bit spoiled. Even though I wanted to, I haven’t made any purchases since about 2013 because the returns just weren’t as good as what I was used to. In hindsight, not continuing to purchase turned out to be very narrow minded.

This year, after listening to some podcast episodes, and a presentation at a real estate meet up, I decided I had to reengage, and eventually pulled the trigger on the following deal.

Property Details:

Location: 13537 Cedar Rd., University Heights, Ohio (Cleveland Metro)
Neighborhood Rating: A-
Purchase Price: $153K
Repairs: $65K (completion expected by May 1)
Expected Total Investment: Approx. $225K

Property Features:

First floor: 2 bed/1 bath, potential rent $1,200
Second & third floor: 4 bed/2 bath, potential rent $1,500
Separate utilities and heating/central AC systems

Initially, I projected over an 8% cash-on-cash return. However, two oversights have affected my calculations: (Both dumb mistakes I can only blame myself for)

Higher-than-expected property taxes and municipal fees in University Heights compared to Cleveland proper.
Overly optimistic rental income estimates.

After adjusting for these factors, including property management costs and other expenses, the revised cash-on-cash return is about $12,000 annually, slightly over 5%. The property was bought and renovated with cash, so there are no financing costs—just the opportunity cost of the investment.

Comparatively, I'm currently earning 5% in a money market account and 10% from participating in hard money loans. The after-repair value (ARV) of the property is estimated at $260K, which could net a profit of $15-17K after selling expenses.

At the sale price of 260K, the property meets the one percent rule and features a brick exterior, new roof, 2 new bathrooms, and 1 new kitchen. The existing kitchen and bathroom on the 1st floor looks in pretty good shape. While I don’t need the funds immediately, selling would allow reinvestment in hard money loans at 10% or a similar real estate deal.

My main concern is tenant turnover, potential repairs, and the costs associated with re-leasing making my return even less. My current estimates carry $200/month for potential expenses, which is included in the calculation that says 5% cash on cash return.

I’d love your perspectives on whether to sell or start renting out this property. I'm really on the fence.

Also, if anyone knows of a resource that helps predict anticipated appreciation or anticipated rent growth, please share!

Thank you for your insights!