Rent or sell my home?

[Dave Largent]

I want to become and grow as a buy-and-hold real estate investor until I have replaced my current income.  The path I like is buy-and-hold, however, I expect to pursue flips on occasion to boost cash for buying rentals.

In May this year my current home will no longer be my primary residence.  I am not purchasing another home but will take up residence with my soon-to-be spouse.  I can sell or rent my home.  Selling has the upside of no capital gains tax as I've been in the home for more than two years.  Selling would give some cash to buy possibly two rentals or a multi-family.  If I lay out some data, can you help me make a decision toward my long-term goal of replacing my income through buy-and-hold?

• Single family ranch, 3/4 acre lot, septic, 8 year old 3 tab shingle roof
• Purchased: 2006 for $140k
• Owe: $100k
• Mortgage: $543
• Taxes and Insurance: $205
• Expected rent: $1200-$1350
• Tenant would cover utilities
• There are no association fees
• I will have a property manager
• I am guessing 3-5 years before predictable large capital expenses arise.  The first being air conditioning unit.
• Comparable area sales indicate a sale price in this range: $165-$185k

Thank you,

Dave