Feeling Lost - First Property Looks Cash Flow Negative :(

[Tim L.]

Hello Bigger Pockets!

My name is Tim, a new member of the community. I eagerly want to learn as much as I can from all of you as I begin learning the ins and outs of real estate investing.

Unfortunately, I am realizing that I made a poor decision when I purchased my first property. I purchased a 2 bed/2 bath condo in my area with the intent to live in it for a bit before ultimately renting it out as my first investment property. Now, looking deeper into potential expenses, it looks more and more like my purchase will be cash flow negative on a monthly basis.

My question for you all is this - have any of you been in the situation? Have you thought that you had a decent rental property, and then came to realize that you probably will not be cash flow positive based on what you can charge in rent? What did you do? Should I abandon ship and sell the property once it is time for me to move out of it?

I learned a valuable lesson here and realize now how poor my initial analysis was. Looking for some advice, tips, or motivation! 

Thanks!

Tim

[Dan H.]

@Tim L.  thanks for your service  

Most of the responses are from people in very different markets than San Diego. As has already been mentioned, any retail purchase of SFR in San Diego will be cash flow negative yet many investors purchase them. Are they making a poor investment?

Virtually any purchase of RE in San Diego has produced outstanding return regardless of when it was purchased if it was held at least 10 years.  How?  Both market and rent Appreciation!  

About a year ago I looked at rent and market appreciation on the average San Diego SFR. Average rent had risen ~$500/month over the previous 3 years. In addition, the average San Diego SFR had appreciated $152k in the previous 5 years.

There are multiple ways to make money on buy n hold RE.  Cash flow is one of the slowest methods.

So the decision to sell should not be based solely on the cash flow.  Is it likely to produce a good return?  Is it free of landlord headaches?  The decision to sell likely needs to be based on more than its projected cash flow.

Good luck