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Updated 13 days ago on . Most recent reply

Made a mistake, sell?
Hello all,
I have purchased a property I planned on living in for a year- then moving back into my parents and renting. The more I run the numbers, I realize I made a mistake. I will be negative most months after all expenses considered. Any advice? Do I just sell the property? Do I rent it at an even/loss outcome?
I purchased to property for $250k and will most likely be able to get $255-260k. Making it a loss after all considered.
I am kinda lost and need some direction. Thank you in advance for the advice.
Most Popular Reply

If you’re planning on living in it, it was never about the cash flow in the first place in the short term.
You might as well live in it for the time you planned on. No harm there.
After that time you can re-evaluate current rents, and decide if it is worth renting while the unit appreciates over time.
While positive cash flow is always desired, you will almost always make more money off appreciation than cash flow. Cash flow just lets you afford to continue to own the property by paying the bills. So the question becomes, “how long do I want to / how long can I afford to hold the unit if it isn’t cash flowing well (or at all)? That is more or less a self-analysis question we can’t answer for you.
But since you have already sunk costs into buying it… Closing cost, transfer fees, etc., you might as well go ahead and enjoy it in the short term. You never know when the situation may change and you might just decide to stay there? Likewise rents can increase where it might make sense to continue to hold, or maybe property values spike and you will decide it’s a great time to sell!, or maybe interest rates fall and you decide to refinance which in turn lowers your monthly payment to where the unit does cash flow.
All the best!
Randy