Updated over 4 years ago on . Most recent reply
Looking for advice - sell or keep investment property
Hi there I am brand new here and could really use some advice...
I currently have a rental property I've owned for 3 years now. It doesn't cash flow, it costs me $300 a month + maintenance. I bought the property with long term tenants already living there. I have not raised the rent since I bought in 2017. At first the rental income JUST covered the costs of the house but I refinanced recently and pulled some equity to rehab another house I own and now I'm cashflow negative. My tenants are currently paying 50%-60% of market value. I've recently been approached by land developers who want to buy my house and reno it into showroom/sales office for a new development near by (300 houses, commercial plaza and retirement home). I have the opportunity to walk away with a healthy chunk of dough with no stress. Or, am I crazy for thinking of selling an investment property?? and should a) see if tenants will willingly pay closer to market value thus bringing me to positive cash flow. Or b) start the eviction process, reno and re rent for much higher?
side note: I'm terrible at raising rent/eviction. I'm too empathetic of a landlord to make money. 1 side is single mom, the other side is family with new born. Both have lived there 10+ years with no desire to ever move. But, I cant keep flipping the bill each month for others to live with low rent and rely on eventual equity. If I sell to developers, they will evict tenants immediately.
anyone have any advice as to what they would do in this situation?? appreciate any help!!
Most Popular Reply
This is a prime opportunity to make a nice amount of money and then redeploy it into your next Real Estate investment.
It is nice that you are empathetic to the tenant yet thing change in lives and when something changes in their life, they will quickly move out and leave you holding the bag. Best to take advantage of this opportunity. Ask the developer if you can switch your property for one of the new properties that they are building! You get a brand new property to own!
Either way - Good Luck!