To rent or to sell my first condo?

Question

Hi everyone! Happy to say I am writing my first post.

I wanted to get other people’s ideas/opinion on the following:

I’ve recently purchased a new home and was able to keep my condo during the purchase (condo was the first property I owned) it’s a 1BR/1BA located in Hayward. Rents are going for about $1700-$2000 a month in the area, and originally I had planned to keep it as a rental. However, after having it listed for about two months now I have yet to find a qualified renter. I would need to rent it for no less than $2000 to cover all of the expenses on it.

From my point of view I feel like I can go in two directions:

1. Continue to look for a qualified renter and keep paying the note on it until I do so.

2. Sell and take the money and put it in to a property either OOS or elsewhere where it’s more viable to cash flow.

Thank in advance to everyone who responds!

Jonathan W. · Answer

@Alex Heredia I see no reason to keep a condo you can’t rent out for positive cash flow. You can’t rent it at the right price and you can’t find a renter. Move on, renters shouldn’t be that hard to attract meaning your rent is too high meaning you’d have no lower it, meaning you’d make no money. Plus condos appreciate differently and I think you’ll find better appreciation elsewhere

Alex Heredia · Answer

@Ashwin Samtani

@Jonathan Watt

Thank you for the perspectives gentlemen! After mulling it over I am leaning towards selling and taking advantage of a more favorable market. Cheers!

Alex Heredia · Answer

@Aaron Flake

Thank you Aaron! I think this does make the most sense

Aaron Flake · Answer

Sell it and invest in a more favorable market. Not worth it to keep with negative cash flow in my opinion.

Ashwin Samtani · Answer

Hey @Alex Heredia,

I'd say a lot of it depends on the area and what you're willing to endure with not cashflowing (or even going a bit out of pocket). While cashflow is ideal, I'd say that if you're in a market that has a high forecasted appreciation or an expectation that rental rates are going to increase, it might be worth holding on to the property for future gains (especially considering the costs involved with selling, and buying another place)

In my case, I have a condo in Toronto I'm renting out that I'm barely breaking even on, but in knowing that rental rates as well as appreciation are on a rapid rise on this side, I'm okay with not cashflowing for the first few years and enjoy the gains after that.

I don't know that area at all to have much more of an opinion on this.

All the best!

To rent or to sell my first condo?

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