Rentals with equity

[Gregory Solomon]

I have 2 single family rentals. Property A has 3br/2b. 1100sqf. I brought the property in 2009 for 103k , I owe 79k. The homes in that area are going for 200k+ for new construction homes. The rent is $1200 per month with a mortgage of $960.

Property B has 3br/2b 1600 sqf. with detached garage. I brought the property in 2013 for 143k , I now owe 121k. The homes in the area are going for 200k+. The rent is $1300 per month with a mortgage of $1,000.

My question is would it make sense to pull the equity out property A and B to flip another property or use it for another investment multi unit? Or even pull the equity to rehab property A to sell it. 🤔

[Joe Villeneuve]

Here's what I see  (the important numbers):

Property A:
Sell =     200k      Rent = 1200
Owe -      79        Mort -   960
Equity = 121                 = 240
                         T/I      - ????
                Negative CF - ?????

Property B:
Sell =      200k           Rent = 1300
Owe        121            Mort -  1000
Equity =    79                      = 300
                                     T/I - ????
                      Negative CF - ?????

What you have here are 2 properties that appear to have, or very close to, negative cash flow, and you have a lot of cash (200k) buried in these two properties doing you absolutely no good.  

Sell both of them and buy 4 more (at least) using 20% down that cash flow.  $200k as 20% DP gets you $1M in properties.  Right now you have $400k in properties...and negative CF when you subtract taxes and insurance from them.  Buy properties that CF