Do I sell paid off home (LTR) in Palm Springs...?

Do I sell paid off home (LTR) in Palm Springs...?

Real Estate Agent 路 Denver, CO 路 Member since 2017 路 38 posts 路 10 votes

Recently moved out of our SFR in Palm Springs, Ca due to my wife getting a promotion with Marriott we moved to Denver. My house was paid off as a gift from a family member. My question is should I keep the rental and refi or HELOC to get a place out here in Denver and also another income property using the Equity. Or should I sell the existing property...

Property Facts:

Property Value 275-290k

Rent $1750 ( could be more but I cut the price cuz I needed a tenant quick and He鈥榮 trustworthy)

Property Taxes $5200 annual ( has Mello Roos 馃ぎ)

HOA $150 monthly

My tenant has mentioned buying the place which would help me because im licensed both in Cali and Colorado so Id save the commission . Kind of a unique situation that I need experienced ensight on...

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CA 路 Member since 2019 路 29 posts 路 8 votes
7y

Figure out what your margin would be in each situation. 

Option 1: Keep the CA house, rent it, and take out a HELOC to buy something in Denver.

Option 2: Sell the CA house and use the funds to buy something in Denver

Add up all your costs and profits for each option, total, and see which one leaves you with the most money at the end. That's your answer!

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  • Realtor 路 Lone Tree, CO 路 Member since 2017 路 139 posts 路 112 votes
    7y

    @Wyatt Degaine
    Welcome to Denver!
    I would consider selling it. As your primary home, you save on capital gains. I would consider using a little bit of leverage. Maybe buy a property FHA here in Denver, and then purchase an investment property elsewhere.

  • CA 路 Member since 2019 路 29 posts 路 8 votes
    7y

    Figure out what your margin would be in each situation. 

    Option 1: Keep the CA house, rent it, and take out a HELOC to buy something in Denver.

    Option 2: Sell the CA house and use the funds to buy something in Denver

    Add up all your costs and profits for each option, total, and see which one leaves you with the most money at the end. That's your answer!

  • Member since 2016 路 13k+ posts 路 12k+ votes
    7y

    I would sell it since the rent is far too low based on the value of the property. $290 K cash sitting dead in real estate is wasted. With a investment value of 10% that is a lost income of $2400 per month. Your property is very deep into negative cash flow.

  • Rental Property Investor 路 La Quinta, CA 路 Member since 2014 路 1k+ posts 路 779 votes
    7y

    Definitely looks like a "sell" to me.

  • Real Estate Agent 路 Denver, CO 路 Member since 2017 路 38 posts 路 10 votes
    7y

    @John D. I sent you a connection, definitely going to sell it at this point. Also I saw you invest in the greater PS area primarily in high end. I may have an opportunity for you. Thanks for the advice.

  • Real Estate Agent 路 Denver, CO 路 Member since 2017 路 38 posts 路 10 votes
    7y

    @Thomas S.

    Thank you for the insight selling is probably the route I鈥檓 going to go.

  • Real Estate Agent 路 Denver, CO 路 Member since 2017 路 38 posts 路 10 votes
    7y

    @Kate Johnston

    I鈥檒l definitely take your advice into consideration I appreciate you taking the time to comment.

  • Real Estate Agent 路 Denver, CO 路 Member since 2017 路 38 posts 路 10 votes
    7y

    @Kate Johnston

    I鈥檒l definitely take your advice into consideration I appreciate you taking the time to comment.

  • Real Estate Agent 路 Denver, CO 路 Member since 2017 路 38 posts 路 10 votes
    7y

    @Tanner Crawley

    Thanks! My wife and I love it out here! It鈥檚 a nice change from the desert. That was a fun blizzard we just had wasn鈥檛 it!? Thanks for the advice!

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