New investor seeking advice sell or rent
I am fairly new to real estate bought a town house in San Diego last year as a primary home. Interest rates around 6% but looking to move for work. I am deciding if to
1. Rent the place and have a delta of -$2k per month I carry each month. This is quite expensive but hoping to refinance in perhaps a year . Owe about $900k on the loan. Rent would be perhaps $5k , however San Diego rentals have come down this past year
2. Sell the place although it’s only been a year, hoping to at least break even.
My worries are the interest rates will remain elevated so securing another 6% interest rate on a property might be tough to do anytime soon.
would love some advice, thanks!
Most Popular Reply
San Diego is my market. If you purchased that last year, you are going to be negative more than the $2k/month you estimate when accounting for all expenditures using the numbers you provided. My rough estimate is $3k negative.
It happens San Diego YOY price increase of 9% should be enough to barely cover selling costs. This implies you should be able to exit about even (small profit or loss).. https://www.corelogic.com/intelligence/us-home-price-insight...
if your hold was longer so there was significant prop 13 discount I may recommend holding but not the case here. In addition a home bought for your use is seldom the best invest RE purchase. Add residential RE is not passive even with the use of a PM.
Do you have the necessary down to purchase where you’re moving without selling? Even if you do I would sell this unit.
The negative $3k will decline with time and eventually go positive. It will appreciate over the long term. But there are better investment options.
good luck