Sell, 1031, or keep renting?

[Roman S.]

Hello real estate gurus. I have a 1 bedroom condo in Daly City, CA that I have been renting out for about 7 years and as my leasing contract is about to expire, I am trying to decide, whether to keep renting it out or sell it, or try to do a 1031 exchange to a property in CA (if I can find something cash flowing:) or even out of state. I was looking at Sacramento multi-units as an example. 

The place is worth about $410k today, though I would need to do a bit of a rehub (~$6k), as it had a family of 4 living there for the past 7 years. I purchased it 12 years ago for $325k (no downpayment) and still have $231k balance on the loan. I have an adjustable loan and my mortgage payments will probably slightly increase to about $1500 a month. I can realistically increase the rent to about $2075. Taking into the account property taxes, insurance and HOA I will be about $250 negative every month (I know that there could also be repairs and vacancy).

I don't necessarily "need" the money now and I could continue leasing it out and paying the monthly difference, but I could also 1031 exchange it for another property that actually cashflows and is a better investment. But, 1031 is a bit tricky and I am a beginner at all this. I could also just sell it, and pay the tax, given some of the dire economic predictions under Trumps administration.

I am leaning toward 1031 exchange, but not sure if this is the best option, any advice is greatly appreciated.  

[Melissa Gittens]

@Roman S. I would recommend 1031 exchange since you are not cash flowing on this property I would suggest selling it and finding a property that will make you money even if it is outside of the area that you live in. If you look at real estate investing as a business you should also way be cash flowing in some way shape or form. The name of the game is profit or increase in profit. I hope that helps.