Hello, my current tenants are offering a decent price on my property and I'm considering selling to them by owner, using only a title company and lawyer. The property has rented for the past 5 years with no vacancy and I make $200/ mo after all expenditures. However, the property value has gone down 5% since I bought 10 years ago and is very stagnant, same with rent. It has not been updated since I bought, new, in 2009 and is in average shape.
If I sell, I'll make a 20% profit off the original investment (10 yrs).
Would you sell or would you keep? Thoughts?
@Jason Piper It is a little difficult to make a full calculated decision since I don't know how much money is in the deal and when additional rehab was done in the exact year. If you do want to get involved in some calculations you could try to figure out the time value of money against its current net worth with the income the home is generating.
Or ignoring the complex math problems, a good rule of thumb is if you can make 10X the yearly cash flow when selling, consider offloading the property and investing in another.