I’m newly married and am living in my husband’s home. I own an 1,800 sq foot townhome. If I sell it, I can pocket $130,000. Which means I could have money to purchase multiple properties.
If I keep it, I can rent it out for $1,600 a month. My note is $885.
Here’s the caveat...I just went 1099 with my job, so every lender I go to says I need 2 full years as a 1099, before they will cover a note. So, that really leaves my hands tied with buying any new property immediately.
What should I do?
At a quick glance without any detailed numbers, it looks like you should probably cash flow if you kept the property. If I were you, I'd sit on the property and collect the cash flow for 2 years, then reevaluate. Obviously there would be risk involved, as a lot of things can happen in 2 years. However, I'd argue that there is no more risk in holding than there is in pursuing hard money and ending up not being able to refi out.
I'm sure there are those that would say sell and pursue private money or hard money, but if monthly cash flow is $300 or more I'd wait it out.
If you’re Husband is W2 and get financing you could also do that.
If that’s the case and it works for y’all to do that, I would sell and go buy more rentals
Realize, assuming to bought it to live in it, and did do for st least 2 years, you have up til 3 years from the date you moved out to sell it cap gains free.
Keep it and cash flow. I think the market is at a peak with a ton of investors so good deals are harder to find. My strategy is to save up cash and wait for the next market correction when all these newbie investors start selling off their properties at a discount.
I learn from one investor " Know you exit "
It would be your choice to sell or keep if you know what your exit would be. Do you want to get cash flow over two years or get a lump sump now. What would you do with the capital gain minus tax consequence ? are you 1031 exchange ?