Rental House: keep or sell?

[Lewis C.]

Hi folks,

I own 4 rental properties in Memphis, and have been investing for 16 months. I am looking for advice on this situation:

The first house I purchased cost 115k and it rents for $1,200. For those of you that know the Memphis market, you will know that this is a horrible return. My other 3 properties have far better COC returns. My lack of experience coupled with a desire to buy my first one, led to this mistake. My question is this:

Should I sell the property and use the cash to invest in a different property with better returns, or hang on to it? it is cash-flow positive (barely); I only purchased this house 14 months ago. After closing costs etc I would anticipate a loss of around 5-8K on my original investment. I have around 33% equity in the property.

Thanks in advance for your insight.