What would you do????

[Meg K.]

I know most people on the forums are well established financially and have real estate acumen, so please bear with me and be gentle ;)

I have lived in an owner-occupied duplex (top/bottom) for 12 years now occupying the first floor and renting out the upper unit.  For some reason i prefer the downstairs.  I do not like living on the 2nd floor.  It appears this was a bad plan because most people interested in renting the up stairs have children.  The floors are wood and i hear noise and everything going on upstairs if there are kids.

I've had the current tenants for 6 years now.  They have always paid late..after the 15th sometimes and since i am soft at heart i have let it slide for several years now.  Recently the wife and i had a falling out.  She reported me to the city inspection for 2 tiles on her kitchen floor that were worn out.  The city ended up inspecting the whole house and insisted that i paint some walls (a bit of cracking paint) and paint the exterior (a bit of cracking paint).  This is a 1921 Stucco/brick house.  So you can imagine it is not cheap to maintain.  Anyway, I am taking this personally and since I never charged late fees for the late rent, i want them out so that i can start over.  ALso the property is not in a highly desirable area even though the properties are well maintained old houses.  I am worried i will not be able to find good tenants in terms of understanding that i, as the landlord, lives downstairs.  The current tenants kids have since grown up so the running feet is no longer an issue.  Most people who inquired about the place in the past (3 BD) are single mothers with kids.  Yes, I know about discrimination but I live downstairs...

Current tenants have a month to month...i know i cannot ask them to leave within 6 months because they filed a complaint with the city.  Should I let them stay, continue to collect below market rent, and put up with the high maintenance wife?  Let me say that the husband is the total opposite and has occasionally helped me out with no charges with the property.

I ve thought of moving (out of my own house) and renting both units out.  But, as a social services employee, i make about $40k a year.  Not enough to purchase a second home.

Current mortgage is $956/mo...rental income is $740/mo

Thank you for listening to my emotional dilemma.

Meg