Sell at a Loss or Wait? Looking for Advice on Underperforming TX House

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Sell at a Loss or Wait? Looking for Advice on Underperforming TX House

Yulya Marucya
Investor · Member since 2019 · 10 posts · 4 votes

Hey everyone — I’d love your input on what’s honestly been a frustrating situation.

I bought a home in Austin, TX (Pflugerville to be exact) back in 2021 as an Airbnb investment for $420K and put in about $100K into it (5% down payment + lots of repairs). 

Fast forward to today: home value is $400K or less, it's cash-negative at -6K/year as Airbnb or -12K/year as long-term rental and I’m facing a tough decision: sell at a loss, or wait and keep eating negative cash flow and hope the house will appreciate to at least 470K in 5 years.

What would you do in my position?

    Here’s the breakdown:

    📉 Current Monthly Expenses: 2.9K

    • Mortgage (P&I): $1,675.13
    • Insurance: $269.42
    • PMI: $121.00
    • Property Taxes: $602
    • Utilities (avg): $650
    • Gardner: $100
    • Pond Mainteinance: $140 (I have two Koi ponds on the property)

    Total Monthly Expenses: $2,9K w/o utils or ~$3,7 with utils, not even factoring in fixes or capex. 

    I also have a hot tub that costs $185/m to service.

    💡 What I’ve Tried:

    • Airbnb: Net loss of about $6K to 8K/year (after cleaning, taxes, etc.) and a lot of hassle
    • Mid-term rental: Listed furnished at $3,200/month on Zillow — no serious interest yet, no competition either which means there isn't much demand for mid-term furnished rentals in Pflugerville
    • Long-term rental: Rents are 2.2K. So it would actually perform worse than Airbnb (close to -12K/year) unless I bring in an investor to lower the monthly mortgage cost which is unlikely.
    • House-hacking: based on my calculations for 3BR 2 BA house it would still be -5K/year.

    🧠 My Dilemma:

    • My mortgage balance is 370K. Selling now at 400K would mean losing a ~$100K initial investment, AND paying 8-15K out of pocket now to cover fees, plus losing my 3.5% mortgage (big asset in today’s 7% market).
    • If I wait let’s say 5 years, I’d need it to appreciate from 400K to at least 470K to just break even with factoring in negative cash flow. And I’d still not recoup the 100K I invested into renovations. For that to happen the house needs to be closer to 600K. How likely is that?
    • And if we go into a recession and Airbnb stops working, I’d be stuck with -12K property per year... waiting until it appreciates. 

    🔍 What I’m Looking For:

    • What would you do in my position?
    • Am I missing a more creative option?
    • Would selling and taking the hit now be smarter than waiting and losing $6–12K/year in hopes of recouping it later?

    Appreciate any thoughts or experiences you’re willing to share 🙏

    1Reply
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    Most Popular Reply

    Andrew W.
    Investor · Austin, TX · Member since 2017 · 71 posts · 76 votes
    1y

    I would give MTR another try since you already have it setup and furnished. 

    My friend Vivian in based here in Austin and has free training materials for getting the best MTR bookings https://vivianyip.com/. She also manages MTRs for investors.  

    2Reply
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    • Bill B.
      Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
      1y

      House hacking is easier than STR and in your example loses less money. Although MTR through furnished finder (dunno if Zillow is appropriate place to advertise) looks like it might only be $500/mo negative, less if they pay utilities.

      You are cashflow negative $5k - $6k/yr but you’re paying off more than $6k on the mortage even month 1. (More and more each year.)So you’re turning a profit and producing a tax deduction with depreciation worth at least a $10,000 deduction saving you $2-4k depending on your tax rate. So while it’s cashflow negative it actually produces a tax free profit. 

      1Reply
    • Andrew W.
      Investor · Austin, TX · Member since 2017 · 71 posts · 76 votes
      1y

      I would give MTR another try since you already have it setup and furnished. 

      My friend Vivian in based here in Austin and has free training materials for getting the best MTR bookings https://vivianyip.com/. She also manages MTRs for investors.  

      2Reply
    • Wale LawalBusiness Member
      Real Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
      1y

      @Yulya Marucya

      You're in a tough but common spot many Austin-area investors are facing right now—buying high during the peak and now holding a negative cash-flowing asset. Since you’ve got a 3.5% mortgage, I'd explore every creative strategy before selling at a loss—think co-living to maximize rent, furnished room rentals, or partnering with a local operator to optimize Airbnb management. But if your financial or mental bandwidth is stretched, cutting losses now could free you up for better opportunities in stronger cash-flow markets. If you need help running numbers or want a second set of eyes on options, DM me and I’ll point you in the right direction.

      Good luck!

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    • Chris SeveneyBusiness Member
      Moderator
      Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
      1y
      Quote from @Yulya Marucya:

      Hey everyone — I’d love your input on what’s honestly been a frustrating situation.

      I bought a home in Austin, TX (Pflugerville to be exact) back in 2021 as an Airbnb investment for $420K and put in about $100K into it (5% down payment + lots of repairs). 

      Fast forward to today: home value is $400K or less, it's cash-negative at -6K/year as Airbnb or -12K/year as long-term rental and I’m facing a tough decision: sell at a loss, or wait and keep eating negative cash flow and hope the house will appreciate to at least 470K in 5 years.

      What would you do in my position?

        Here’s the breakdown:

        📉 Current Monthly Expenses: 2.9K

        • Mortgage (P&I): $1,675.13
        • Insurance: $269.42
        • PMI: $121.00
        • Property Taxes: $602
        • Utilities (avg): $650
        • Gardner: $100
        • Pond Mainteinance: $140 (I have two Koi ponds on the property)

        Total Monthly Expenses: $2,9K w/o utils or ~$3,7 with utils, not even factoring in fixes or capex. 

        I also have a hot tub that costs $185/m to service.

        💡 What I’ve Tried:

        • Airbnb: Net loss of about $6K to 8K/year (after cleaning, taxes, etc.) and a lot of hassle
        • Mid-term rental: Listed furnished at $3,200/month on Zillow — no serious interest yet, no competition either which means there isn't much demand for mid-term furnished rentals in Pflugerville
        • Long-term rental: Rents are 2.2K. So it would actually perform worse than Airbnb (close to -12K/year) unless I bring in an investor to lower the monthly mortgage cost which is unlikely.
        • House-hacking: based on my calculations for 3BR 2 BA house it would still be -5K/year.

        🧠 My Dilemma:

        • My mortgage balance is 370K. Selling now at 400K would mean losing a ~$100K initial investment, AND paying 8-15K out of pocket now to cover fees, plus losing my 3.5% mortgage (big asset in today’s 7% market).
        • If I wait let’s say 5 years, I’d need it to appreciate from 400K to at least 470K to just break even with factoring in negative cash flow. And I’d still not recoup the 100K I invested into renovations. For that to happen the house needs to be closer to 600K. How likely is that?
        • And if we go into a recession and Airbnb stops working, I’d be stuck with -12K property per year... waiting until it appreciates. 

        🔍 What I’m Looking For:

        • What would you do in my position?
        • Am I missing a more creative option?
        • Would selling and taking the hit now be smarter than waiting and losing $6–12K/year in hopes of recouping it later?

        Appreciate any thoughts or experiences you’re willing to share 🙏


         Bite the bullet and make the decision based on a business decision which is sell it. you can try seller finance but you will still probably cash flow negative (but its an option), but I would sell it, get it off your plate, move on and stop spending time on it and focus the time on your next more successful acquisition.

        Question I have: When you bought it how did you pencil this out? Did you run it as a long term rental and show cash flow? Why is it so negative, where did things go wrong?

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      • Neil Narayan
        Real Estate Broker · Austin, TX · Member since 2015 · 715 posts · 527 votes
        1y

        Based on the outlook for Austin (growth and investments) i would not sell it now at a loss. If it was me i would tighten the belt on the expense and look for ways to balance the equation (expenses vs income) i.e

        Options for reducing expenses:

        - get rid of koi pond (-$1680)

        - do gardening yourself (-$2100)

        - get rid of hot tub (-$2220)

        - cleaning is the biggest expense for me, can you do it your self or find a cheaper alternative (-$4000-10000)

        - your utility bill is really high at $7800 annual (try to see what is going on, removing koi pong and hot tub should help as well)

        Increase income:

        - list on VRBO as well, market the property on various sites and forums to increase visibility, switch to rent by room (house hacking)

        If you are $6k negative, the above should help get you to cash flow even or positive. 

        2Reply
        • AJ WongBusiness Member
          Real Estate Broker · Oregon & California Coast · Member since 2022 · 834 posts · 696 votes
          1y
          Quote from @Neil Narayan:

          Based on the outlook for Austin (growth and investments) i would not sell it now at a loss. If it was me i would tighten the belt on the expense and look for ways to balance the equation (expenses vs income) i.e

          Options for reducing expenses:

          - get rid of koi pond (-$1680)

          - do gardening yourself (-$2100)

          - get rid of hot tub (-$2220)

          - cleaning is the biggest expense for me, can you do it your self or find a cheaper alternative (-$4000-10000)

          - your utility bill is really high at $7800 annual (try to see what is going on, removing koi pong and hot tub should help as well)

          Increase income:

          - list on VRBO as well, market the property on various sites and forums to increase visibility, switch to rent by room (house hacking)

          If you are $6k negative, the above should help get you to cash flow even or positive. 


           Well said. Great advice from a clearly experienced PRO. 

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      • Theresa HarrisPro Member
        Member since 2019 · 15k+ posts · 11k+ votes
        1y

        I agree with Chris and others. When you bought it, you paid 5% down, so you would have been living in it for a bit. What did the numbers look like as a STR? Rental bought to be STR and where numbers only work for STR are very risky. You have quite a few maintenance costs (eg the ponds), are there things you can change to lower your monthly expenses?

        0Reply
      • Yulya Marucya
        OP
        Investor · Member since 2019 · 10 posts · 4 votes
        1y

        Thank you everyone! Yes, I can get rid of the hot tub. Not the Koi ponds though because that would cost a lot and just psychologically hard. House-hacking is similar numbers as STR.

        MTR already tried. @Andrew W. I actually did work with Vivian and had 0 leads for MTR..

        At best, my cash flow is still Negative -$600/m for long term or STR.

        If I estimate appreciation 2.5-3% then that -$600 invested in S&P 500 outperforms the house in 5/10/15 yr term! Unless appreciation exceeds 4 % a year. How do I estimate the probability of that?

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