Should I sell my rental acquired from a divorce

[Nick Sutton]

In April 2012 I purchased a 3bd/2.5bth 1800 sq ft. townhouse house from my ex-wife that we bought together quite a few years before. Not really understanding rental properties I thought I was doing the right thing and taking advantage of an opportunity to own rental property. Needless to say that didn't pan out how I had hoped.

My purchase price was $206,012 in a 30 year mortgage at a fixed 3.875% rate. I currently owe $169,041 on the property and the mortgage is $1,194.90 and I am capturing $1450.00 in rent. I have a property mananger @ 10% fee so my take home is $1,305. To add to the damage, this home is located in a subdivision with a $95 HOA fee. My net gain from this property is $16/mo.

In the 8 years of ownership, I have only had 3 months of the property being vacant and two of those months were when I first purchased the house. It's been a strong rental in the sense of occupancy.

Repairs on the house have been mostly minor. I replaced the HVAC in 2012, water heater in 2010. When I lived in the property, I updated the kitchen with nice appliances, ceramic tile flooring and also renovated the flooring in the master bath as well as update a spare bath.

I know the property will need a new roof within the next few years and I am sure there are other items that will be coming up at some point such as the water heater again and possibly the HVAC again.

The downside to this property is that this area of our city took a pretty significant hit in 2013-2015 with city assessments and the property assessment went from $213,100 (2013) to $164,300 (2014). It's currently assessed at $165,300. I would assume the house would appraise for $160's to mid-170's when comparing to surrounding properties that have sold. Basically I am dead even on what I owe and what it's worth.

Is this property worth hanging on to since it's fairly "cheap" and refinance the current loan amount or should I just part ways and take my loss to get it out of my portfolio.

Does refinancing make sense even if I have to get back in to PMI? If I refinance the property, pay PMI & Property Management and the rental income staying at $1450/mo that should make this property cash flow approximately $200-$300/mo

I'm just really stuck on what the right decision is for this property and I really want to do my best to "correct" my dumb move back in 2012.