Sell or rent in Jacksonville fl

7 Replies

What up BP! I just bought a vacant lot and am building a house which I will be moving into in 4 months. Need to decide to either sell my current home and use the equity to purchase other rentals or keep it as a rental. My goals are to build a rental portfolio however this will be my first deals so any advice will be helpful.

Current home value $400k
Amount owed $333k (28years left)
PITI $2000/month
Will rent for $2500

No major repairs needed. I'm thinking new a/c in about 3-5 years, new roof in maybe 10years. Electric and plumbing are updated with no issues.

Do these numbers make sense to hold or should I be looking to use the equity to purchase other properties?

Cheers!

Hey Max, As a pure cashflow play, it's a loser.  The capex expenses, new A/C, new roof in the timeframes you estimate, combined with normal operating expenses will eat up your profits for sure.

However, there could be an appreciation play here.  How close to the ocean is the property?  Being you are in AB, are you closer to Neptune Beach or closer to Mayport?

what Dana said: it's a no go for holding: if you can sell it, I sure would.  Your expenses on your current primary property are going to consume any cash-flow of the monthly rent, especially over time.  

813-435-8414
Originally posted by @Dana Whicker :

However, there could be an appreciation play here.  How close to the ocean is the property?  Being you are in AB, are you closer to Neptune Beach or closer to Mayport?

 Its ~5 blocks from the ocean right on the neptune/atlantic beach border. I am definitely thinking more about the appreciation for this properly vs the cash flow (for now). I hear stories of people that sold houses years ago that really wish they didn't so I am trying to hold on to as many as I can. Plus I believe this would attract some class A renters since it's in a nice neighborhood and the upper end of price. 

I have a property similar in cashflow to yours simply because I bought it as a primary residence years ago. As i despise mortgages, it is my only one and will now be paid off soon. It hasnt been hard to keep even without cashflo because being in Neptune Beach, it is NEVER vacant. Tenants Ive had here have all been professionals and paid on time and the demand is so high, it is always rented in a matter of hours. If i had it to do over again, I would still def keep it.

Definitely not a rental. Most of our portfolio follows 2% rule or what I call $200 in rent/month for every $10k invested. Unless the property is above 1% and has major appreciate or strategic/development value, I would suggest selling.

Thanks @Tracy D.

An update to this post is that I decided to sell. I got $400k the day after I put up a FSBO sign (looking back, I likely could have gotten more, but happy with my proceeds and no realtor fees). Atlantic Beach is growing fast.

I took the equity and now have another property under contract, my first rental so I hope it works out. 

Purchase price $83k, down payment and closing costs of $30k, current renter in place paying $1050/mo. PITI ~$500. After other expenses (vacacy, repairs, etc..) I'm hoping for cash flow of ~$250/mo

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