Waffling...

[N/A N/A]

So I have inherited a 2/1 condo (not taxed at all) and own a house otherwise (the house is in a marginal area, great for a rental, we want out). My equity on the condo will be ~80k net if sold. Now, there is work to be done on the house before I would consider renting or selling (AC, electrical, paint) that will cost ~15k.

A friend (also an investor) tells me to sell the condo (or 1031 exchange it), rent out my home and buy (exchange to) a nicer one for us. Now, here in Sacramento, values are very high and I will have to come in with a low down payment on a new(er) home and a high mortgage to boot. Hmmm. Kinda dicey.

My friend's reasoning: I will have a greater equity gain on a house and perhaps a better income (again, renting out my current house instead of the condo).

Then there's the other thought of selling the condo now and putting the equity into a cd, gambling that the market will flatten or dip, and buying low.
http://money.cnn.com/2005/07/14/real_estate/buying_selling/cashing_out/index.htm

What would you do? Thx. Chris