Time to sell?
after listening to one of the podcasts I've been thinking that maybe it's time to sell one or two of my units to take some cash off the table. I have a condo in Kirkland Washington that I bought in April of 2014, it's fully paid off and nets about 1k a month, I figure I can pocket 100-120k if I sell it in the next 12 months. I know the greater Seattle market is super hot as far as rent prices go. Opinions and thoughts?
What is the point of selling the condo? Is it so that you can invest in another property? Or do you just want to spend the cash? It seems to me that you are doing great since you own it outright and unless you are getting another property with a higher cap rate I don't think it would be good to sell. Especially since Kirkland is a great location for many people. You can most likely increase your rent for more profit as rent prices are rising every month at this point.
Cheers,
Listen to more podcasts, and you will hear all the people who regret selling their rentals, lol. I say hold it, unless you are looking to liquidate and get out, or move up in real estate! If you're looking to move up, don't forget about the 1031!
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Real Estate Agent CT (#0807610) and MA (#9557050)
- Connecticut Property Management
Originally posted by @Mark Kao:
Opinions and thoughts?
Don't kill the Golden Goose!
Why not cash out refi and convert $450 of your cash flow into $100,000 for another investment?
If Condos there are NETTING 1% per month into your pocket, why would you sell? Buy MORE!
Otherwise, please explain how YOU expect it to net even better than $1k per month? Thanks...
(Podcasts tend to generalize - whereas we have to decide SPECIFICALLY. Do you REALLY think you'll be able to buy two similar condos soon if you cash out now and wait for their price to crash? I think rather, that those "sell now" podcasts should be aimed at people who may be over-leveraged).
I thought about doing a cash out or heloc but episode 188 of bigger pockets got me thinking that maybe I could take a little off the top. I'd most likely use the 100k to pay off one of my other houses.
@Mark Kao, are those loans at high interest? And/or, are they TOO highly leveraged? If not, what's the hurry? Will doing so really gain you MORE than $1k/m straight away, forever?...
no, I only have 2 mtg's (fixed 3.75 and 4.25), lot of equity in all my properties (4 units).
Originally posted by @Mark Kao:
no, I only have 2 mtg's (fixed 3.75 and 4.25), lot of equity in all my properties (4 units).
In that case, NOW is the very time to borrow against their higher appraisals, rather than sell!
You do get that wise-leveraging is the ONLY way to scale your long term wealth, quicker, right?...
If it were me, I would pull out 50% of the equity so your LTV stays good and it cash flows. Then I would take that and get into another small multifamily property.
I'm fairly conservative as far as leveraging goes, I think I'm probably at around 30% LTV(?) I recently had an engineer buddy run some numbers with me (he's super conservative) I think I'll look at taking out 100-150k at a fixed 30
@Mark Kao - a fixed 3.75 and 4.25 is outstanding, wish I could get those numbers on some of the NOO properties I'm looking at right now.
My opinion is that if the condo is paid off and you haven't had any bad experiences with the HOA, nor have any reason to believe a series of special assessments are on the horizon, then I'd do as others have suggested and pull maybe 50-75% equity out to expand your portfolio.