Long story short, I had my house 5/4/3 on the market in Frisco Tx and was going to sell it and downsize. I work out of state and it is just my wife and son. I was going to move them into a 3/2 SF just north of us. I make great W-2 income so I qualified to buy a new house without a contingency. I found a great deal on a 3/2 in Prosper Tx and pulled the trigger and put 20% down.
Fast forward. My house has now been on the market for 60 days, no offers. Two price reductions and I own two houses and have two mortgages. And I am getting transferred back home after the first of the year.
In the last 30 days i converted the 3/2 in Prosper to a 4/2 and added An Office w/French doors in part of an oversized living room. Added hardwood floors. The house is 2100 sq ft and is 500 sq ft bigger than the average 3/2.
Do I pull my big house off the market and just rent the smaller Prosper house and BRRRR. Here are the numbers.
I bought for 257k. Appraised for 277 as 3/2. Mortgage is 1750. I can rent fir $2000-2100. I have spent 8k on construction to convert to 4/2.
Comps on other 4/2 in the neighborhood are well above 300k up to 320k
I think I should get a tenant for long term lease(2yr), refinance after seasoning in 6 Mo or so. If I get my 305k appraisal I could pull 25k out at that time and buy something else?
I need advice from seasoned investors as this was an accident...
Appraised value $277 - $305K, mortgage $1750, rent $2100, expenses $1000.
This is not a good investment property, rent to value is way too low, you will have negative cash flow.
I would sell before it turns into a money pit.
Thanks Thomas, just trying to determine the best exit plan from my unforeseen circumstances.
Hi Douglas. My wife Becky is a DFW realtor with KW McKinney and has lots of knowledge/experience in the Frisco/Prosper markets. She might be able to at minimum provide helpful counsel given current market dynamics. If you send a colleague request I can send you her contact info. FYI we own rental SFRs in the area as well. Best of luck to you. Dale