Keeping California condo as rental vrs selling when moving away

[Melissa Coombes]

Family member is relocating out of California for a job opportunity. Owns a condo in Valencia, Ca. Bought for low 200’s in 2013. Current value is ~340k. I have been looking into jumping into real estate investing for some time but just graduated Masters degree in college and am still trying to save up some $$ as I am starting back at 0$! So I’m nervous to give advice when I haven’t done any investing myself yet. If they did a cash out re-fi for 70% loan to value with today’s interest rates my math shows they could walk with around 50k to start over in the new state... and cash flow 300$/mo. I’m including 300$ for hoa, 200$ cap eX, 10% rent for property management. Rounded up for all expenses and down for all profit numbers... am I missing anything big?? Is it better to sell now while the market is red hot here and not risk the potential COVID crash later??! Sorry for long post, thanks for any opinions and advice!! 

[Michael J. Abel]

I grew up in the Bay Area and have lived in California most of my life. You also need to take into account vacancy, property taxes, and insurance. Keep in mind that property management has two components- 1. Day to day property management 2. Leasing. Leasing can be up to 1 month of rent depending on the property management company and location. Make sure you are factoring in these pieces into your analysis. Also, California tends to be a tenant friendly state so i would also take this into account. Selling the property might make sense if you are able to find a better investment. Your family member could also take advantage of house hacking so you might want to consider that option as well.