What should I do next with a condo if hoa is increasing? quick analysis & discussion please.

[Harris L.]

Before coming to BP I bought 3 condos with HOAs.. and I'm realizing now why many people don't like properties with HOA...

I have a question related to this.. one of HOAs have been increasing...started off at $278-4 years ago.. and it's now at $325. about $12 per year average. Not horrible but would like to plan ahead and explore my best options. There's always a chance that this will increase faster... and I'm not sure if I should wait before I do something about it...because if I wait the hoa fees might be too high too hard to sell...

I've been thinking about what to do next... I devised up a few options.. please let me know what you think and if you have other ideas...

Here's Details of the condo with increasing HOA fees.

1. Two comparable condo in the area sold for $310k and $302k in the past 2 months..

2. I got it for about $118k.

3. I'm at about 9.+% cap rate - around $900 / month positive cashflow.

4. rent was $1395 in 2012 and then now at $1460 - planning an increase this january by probably 5-10%, lower if 1 year lease is signed.

5. comparable rent in the area for condos of the same size is at about $1800-$2000, so I know I have some room to increase.

Options

1. Don't sell since the cap rate is still good and my main purpose is to get good cashflow, just increase the rent consistently to at least stay with the market increase.

2. do a 1031 swap with a SFR or duplex in a slightly different area...after some research.. I can possibly put in additional capital of $15k-100k there abouts to increase my monthly positive cashflow to $1500-$1800 or so per month.

Considerations for option 2:

a. tax will be higher

b. hoa will be gone

c. estimated monthly expenses will be almost identical give or take 10%

d. there's the commission for the sale and for the buy.

Other options/ideas?