Sell Primary Residence or Rent?
Hey everyone,
I bought a duplex in April of 2014 with the intention of living in one of the units for at least 2 years while the other unit helped to cover the note. This has worked very well for me, but now that I am approaching the 2 year mark in the next 6 months I am trying to figure out whether to sell the house and take the (small) amount of equity or rent out both units. I had always planned to rent out both units once I moved out, but it looks as if I may have misjudged market rent in my area. Here are a few numbers on the house:
Purchase Price: $301,000
Remaining Loan Balance: $285,000
Improvements: $30,000
Improved Home Value: $340,000
Rental Income: ~$2,700/month for both units
P&I: $1390/month ($450 principal, $940 interest)
Taxes: $340/month
Insurance: $310/month
Repairs and Maintenance: $135/month
CapEx: $135/month
PMI: $205/month
Projected Appreciation: 1-2% per year
You'll notice I have not included the cost of a property manager in the numbers above as this would put me in the red every month. Regardless of whether I hang on to the property or get rid of it, I plan on moving to another city and buying another MF property with the hopes of getting a around 15% cash-on-cash return with cash flow. I feel like I've analyzed this scenario a million different ways, but I don't know which way sets me up for the best return in the future. All input is appreciated! Thanks!