Looking for advise on Neg cash flow property

Looking for advise on Neg cash flow property

Member since 2021 · 1 post · 0 votes

Hey everyone, I'm a rookie realestate investor looking for some advice on a rentel property. There's a lot for me to cover so I'll start with the question. Should I keep a rental property with a negative cash flow but gaining equity or sell and reinvest on more properties? Here are the numbers.

- House was purchased brand new in 2016 for $625k

- Tolal investment- $0

- Monthy rent recieved- $3000

- Morgage w/ HOA - $ 3200

- Property mangment fee - $300

- Current value- $900k +

I know that loosing $500 isn't a smart move but I have other properties that bring in enough money to cover the loss. Also, the value has increased so much that I just feel like it's a monthly investment at this point. Another thing to consider is the gains tax [U.S. federal and State]. I would just hate to give up that money. Currently my plan is to make it my primary residence so I can avoid the taxes when I sell. I appreciate any advice you can provide.

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  • Joe VilleneuvePro Member
    Plymouth, MI · Member since 2013 · 13k+ posts · 19k+ votes
    5y

    Get rid of it.  You have equity in it that should be moved to a property that does CF positive.

    Would you work another job in addition to your current one, and pay your employer for the privilege of doing so, just because you make enough money in your current job to cover the money you're paying your new boss?  I didn't think so.  That's what you're doing now with your two properties.

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