Fountain, Colorado Rental, Keep or Sell

[Kevin K.]

I have a rental that I purchased in 2007 without knowing what I was doing.   I purchased close to the top of the market, with a no interest loan, thinking I would do a rent-to-own in a year or two and make a quick profit.  After multiple bad tenets and vacancies I looked to another local investor for help and we did a Lease purchase where he took over the property management, and gets a cut if he can do a rent-to-own, and I get out of it.  2009.  I also refinanced around then and got out of the no-interest loan.  Since working with the investor my headaches have gone away, I get about $100 cash flow after I pay the monthly mortgage, and 10% fee to the investor, but that doesn't cover a big ticket disaster that is probably looming on the horizon.

The market has heated up in Denver which is bleeding down to Castle Rock, Colorado Springs and Fountain.  I have no real exit strategy except to not lose money, but I feel like I am a step away from pouring more money into this property. 

Options: 

I can just let this other investor continue to manage it and then get 3% of the sales price if he can swing the rent to own.

I can get out of the lease option and find a property manager.

I sell the property.. I just have to give 60 days notice and then fix it up.

I purchased it for 160000 (2007)

Appraised at 207000 (2007)

Current value about 185000, but would need carpet and paint at a minimum.

I owe 160000

Home built in 2002, no improvements

Close to Army Post (Ft. Carson) that could be impacted by BRAC

Opinions?