Is it worth making this property a rental or to just sell?

Question

In 2020 I bought my first house 3 bedroom 1 bathroom and a 2 car detached garage for $175,000 and put a 10k downpayment on it and interest rate was 3.5%, in 2023 I decided to rent it out for $1350 mortage was $1106.62, in 2024 we raised the rent to $1450 and our mortage currently is $1144.76- I never put into account repair expenses, Capex, vacency until I read on rental investment properies book. But we have been lucky enough to not receive any issues with this house as when we bought it was fully remodeled literally everything was new.  Is it worth keeping the house and increasing the rent to $1750 or should I sell in the market that we are in?

Timur Salikov · Answer

Calculate how much equity you have in the house, and then calculate the annual return on that equity. I would keep and hold it for the long term, unless you can deploy that money in a much more productive investment.

Madri Koppe · Answer

This depends on your overall goals. If it’s worked out well so far being a landlord and you see opportunities to raise rents then holding on to the property might make sense. If your intent/interest is not in buy and hold and you find a better use for the funds by selling then explore that option.

Paul Garrison · Answer

Hello, I am a Realtor In Ohio,Sounds like you bought with a great interest rate. One option: You could seller finance your house to someone or lease option. You could charge a higher interest rate and negotiate the down payment that way you still get your money monthly & not worry about repairs etc. if the buyer defaults, you get the property back.

Theresa Harris · Answer

how much is the house worth and is $1750 market rent?

If the house has increased a lot in value, you may want to sell to avoid paying capital gains on the profit.

Malcomb Stapel · Answer

@Kevin Orellana do you like the asset; is it in a neighborhood that you are proud to own it, do you see it continuing to be a desirable place to live? Take the answers to those questions and juxtapose against this one. How much and what would I do with the gain on sale, and how does that help or hurt my strategy?

It sounds like a great rental, however, you know it better than anyone on here.

Is it worth making this property a rental or to just sell?

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