Two Hundred Thousand Dollar Question

[Matthew McNeil]

12 months ago, I paid off my first rental SFH property in Boise/Meridian, Idaho. Net cashflow is $1060/month. Comps say the current market value is $230,000. I paid $172,000.

Two options I’m looking at;

1. Sell and invest in two separate SFH rentals. Move-in ready SFH start at $215,000 in my current market. Net cash flow with 20% down puts me around $360/month.
2. Not sell and take out a HELOC to buy another house. My lender is offering 7.85% for investment property.

SEEKING ADVICE; what would BP members advise if they owned such an asset?  BTW – buying a few $80,000 houses in Memphis (for example) is way outside my comfort zone.

[Thomas S.]

Market is irrelevant assuming he is investing for long term hold and properties have positive cash flow.

The actual value of a property is only relevant when refinancing or selling otherwise it is moot.