Sell my house . . . or hold and rent . yes another one

[Kelly G.]

so . . I posted a question over on the Buy/Sell forum a few days ago looking for a CA broker to consult for a FSBO. Had a couple local replies (Thanks!!) and . . . now . . one of these lovely people has my head spinning . . So . . here goes:

I have a 3/1 lovely, small, home on .66 acres in LA county (Lancaster).  Current mortgage is @ $100,000 at 5.5% - didn't refi 'cuz I was gonna sell (bought at $112k).  I could probably rent at $1200; taxes $1300 year; insurance?? @ $800 as rental.  If I hold and rent - I'll refi at ???  4% ??  (a few unknowns here).  Estimate minimum $300/mo cash flow

My current assessment of sell value is $173-$180k.  I don't "Need" the cash to move on.

Should I Hold and Rent:

1) My intent is to leave CA - currently self-unemployed evaluating career options

2) Would have to farm out PM - can be a real problem . . .

3) Lots of rentals here . .   possible advantages: are lower price point (rent), quiet, safe neighborhood, close to groceries, and local college, and option for horses/livestock on property (county not city);   risks:  vacancy for ??? months.  House in good condition - shouldn't need work for awhile (barring tenant damage). 

4) Good cash flow (?)

5) Do I want to be a landlord???  Hadn't planned on it. . . It has it's perks . .  and pitfalls . .  Already have a rental in WI . . .  have often contemplated RE investing as side career (rehab - love love love fixing up my house and swinging a hammer!)  

6) good start for my RE portfolio??

7) re-evaluate in 2 years and keep 'no-tax' benefit of home-ownership when I sell (is that still available?)

8) where is the RE Market going??  risks of selling at a lower point??  Market here could go up another 8%/year barring an election-year downturn.

Or should I Sell:

1) Take the Money and RUN!!  IT's been a good investment in 6 years.  Invest cash probably in stocks . . maybe $65K to pocket/invest average 5%/year on stocks . .   until the next CRASH!! or use when/if I get serious about RE

2) Walk away from CA and don't look back (except maybe to vacation)

I've played with some calculators as a rental . .   but don't know how 'depreciation' will play into that.  

I realize this is really a personal question.   Maybe just posted this to write out my thought process . .  what am I missing?

Thanks for reading . .   

Kelly

[Steve Vaughan]

Take your tax free gain and sell it!  Long-distance landlording?  I'd sell for sure in that situation.  Good luck either way!