I own a house in a suburb of Chicago. I owe about $158,000 on a house that is probably worth about $170,000. I originally put up the house for sale about 7 years ago when the market crashed and it didn't sell. After 2-3 years of sitting mostly empty (I racked up a lot of debt during this time), I found a found a renter. He has been there a lot longer than expected and doesn't want to move. I am currently charging him $1400 per month which covers the mortgage and taxes, but that is about it. I am trying to decide what to do with it. I have been just claiming it on my normal taxes.
1. Should I sell it to anyone who will take it off my hands? Thinking it would be another investor, else I would have to kick out tenant, update it and market it. I don't really want to lose more money on property. If I sell do I try to do it by owner, agent, Craigslist, reach out to REI groups?
2. Should I refinance? Currently at 6% rate, I would have done sooner, but I didn't intend to keep property this long. Originally the tenant was only going to be there a year. Plus the high debt has kept me from doing this. I am just getting on top things now. It would give me a little more positive cash flow.
3. Start a REI company, try to refinance and roll this property into that and try to add another property?
I am open to any suggestions anyone might have.
@Craig J. Refinance that puppy ASAP and buy another. This local market still has a couple of years in rising prices so refinance with a plan to reevaluate to sell in 20 months.
I had a 190k mortgage at 5.875% that I was paying about 1550 on (my first property from 2008). I was able to refinance to 3.25% couple years ago and payment went to 1050. It's rented for 900 but could get more. Plan to keep it and treat as a sort of savings account since I expect the property to appreciate as well.
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