City Construction to Impact Rental Home? Looking for Feedback :)

[Max Fleissner]

Hey folks, looking for any feedback I can get on a situation arising with my rental home.  Appreciate the help  :)     The city (Omaha, NE) is planning on widening the two main roads leading into the neighborhood of my rental property, as well as add a soundwall along the busier of the two roads.  My question is this: have you ever encountered a similar situation where public construction has affected your propert(ies)?  My initial thoughts are that before and during construction, it will be more difficult to find and keep good renters, and my monthly rate could very likely go down.  After construction however, the property value should rise, as the street widening and soundwall are much needed in the area and should improve the neighborhood value.  If you are interested in more details, I go on below.  Otherwise, thank you for your time and consideration to help me out!    Max

Information about my rental:

I purchased the home 4 years ago, with the intention of living in it, but was moved for work soon thereafter and vied to rent it out in lieu of selling. The home is modest in finishes (no granite countertops) but is in a fantastic area when it comes to schools, transportation, etc. Since I was not a REI at the time, I did not buy under the rule of thumbs that would make it a particularly good rental property - that being said, it has worked out well enough: purchase price for 150k, currently renting for 1,450/mo., cash-flowing roughly $150/month after capex and typical expenses, have only had two different families in the 4 years. The market: Omaha has been in a total seller's market for the last couple of years, and this past winter, in which the cold weather typically slows sales down until spring, it remained hot, setting up for a crazy spring. I have heard countless examples of homes recently selling for 10% over asking prices with multiple offers on day 1. With this, I am wary of a bubble forming that could soon pop.

My thoughts:

While I am currently happy with the asset, the combination of getting top dollar for my home BEFORE construction in the area starts is extremely appealing. Factoring in my newfound love for REI, I see an opportunity to be able to use the funds from the sale to buy 1 or 2 properties that can cashflow better than this current home. Am I on the right track? Or am I scared of the construction, trying to time the market and not thinking long term?

Thanks again for your time and efforts!   Max

[Thomas S.]

Construction aside if you can sell and reinvest in more properties that will have better cash flow that is what investing is all about. The idea that once you own a property all is golden and you should hold on till the day you die is bunk. If you can benefit in a positive way from selling you should be selling. That is how you grow not by holding on for dear life.

See an opportunity , take advantage of a opportunity.

Good luck