I HAVE ONE RENTAL NOW WHAT?

Question

I bought a Town Home. For 117,000. I have had it rented for a few years now and want to make more moves just not sure what moves to make. The home on the public record says the house is now worth about 133,000. I would like to know what the smart investors would do in my shoes. I dont make a lot off of this property only about 200 a month. I know most people say that's not an investment that's a second job. I know its not the best but i am trying to start investing so before i go to far off the deep end. I would like to talk to you guys about the next smart move.

Brandon Deegan · Answer

i have thought about refinancing. Just not sure if i should do that or sell and buy another property like this with the equity i have. Then i might be in better equity and lower mortgage so bigger cash flow. Then i can use the new house purchase to refi and get more properties. I do not have money saved up for a second investment yet. I house hacked this one lived in it for a year then rented it out. I am about to do that again this month so in a year i will have another rental.  but in a few months i would like to have another true rental. That is why i am trying to figure out the best route to go. i appreciate your help Joseph.

Joseph Cacciapaglia · Answer

Do you have money saved for a down payment for a second investment? If not, have you looked into cash out refinancing from this town home? It sounds like you may have enough equity to pull some out for the next deal. If you're lowering your rate at the same time, you may even have the same cash flow. $200/month for a small investment property like this isn't bad at all. It also sounds like you may have made several thousand in appreciation since you bought it. Most of the successful investors that I know focus on their total returns, not just cash flow.