Chicago 2-Flat: Hold or Sell?

[Steve Miglieri]

Hello all, would appreciate some feedback on my situation:

My wife and I purchased a 2 flat in the Lakeview neighborhood about 2 years ago, It is a 3 story, 2 unit building near right off the Southport Corridor (Very popular area).

Our initial plans were to deconvert the building into a single family home, we had plans drawn up and everything. Our circumstances changed, and we will now be moving out of state (Minneapolis) and based on the numbers below, would love to hear from some experienced members what they would do:

-Purchase Price: $800,000

-Current Amount Owed: $700,000 (bought building for 10% down, paid down about $20K in principle)

-Total Rental Income: $4,700/month (there is some room for increase, could get $5,000 with rent increases)

Monthly P&I + Taxes: $5,700/month (I took a pretty serious property tax increase this year which increased my monthly payment $500/month.

We didn’t plan on purchasing this building as a long term hold (obvious since it doesn’t cash flow) but we were going to take what, at the time, was a $500/month hit while we renovated the building. That isn’t happening now, and we now have a building that costs us $1,000 / month to carry.

I see the options as:

1. -Sell the property, probably for what I paid - I eat the 5% realtor commission
2. -Refinance with a 75% LTV, which would require me to put quite a bit more cash into the place, which ideally I don't want to do
3. -Do nothing, and hold as is.

Building is in good shape, and in a very popular area, so should hold it’s value, and will rent very easily.

Would love any opinions. Thanks!