Author Topic: Keep or Sell  (Read 2245 times)

trixs

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Keep or Sell
« on: July 23, 2014, 03:32:31 PM »
Hi All,

Two years ago my wife and I purchased two rental homes at rock bottom prices. We spent lots of time and energy renovating them and have rented them out ever since. Anyway, I am curious if you guys would sell them or keep them and collect the rent income. After PITI the rent proceeds come out to about $1000 a month. If it matters my goal is to retire from the military in about 8-10 years and hopefully never work again. This will put me at 40-42 years old and my wife 3 years younger. When I retire from the military I will get a pension worth approximately $30k/year plus inflation. In addition I have two payed off newer cars (ok... a new Prius and a 2010 Fusion) and $270K in the stock market.

Property #1: Mortgage - $35,541 @ 4.125% - Rent $925 - Could sell for $90-100k
Property #2: Mortgage - $28,945 @ 4.125% - Rent $800 - Could sell for $50-60k

Would you keep the properties or sell them if you where planning on never working in less than a decade?

gimp

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Re: Keep or Sell
« Reply #1 on: July 23, 2014, 05:08:17 PM »
Are those mortgages what you have left to pay, or what you put into buying the houses?

Numbers Man

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Re: Keep or Sell
« Reply #2 on: July 23, 2014, 05:29:21 PM »
Keep

waltworks

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Re: Keep or Sell
« Reply #3 on: July 23, 2014, 06:40:12 PM »
#1 keep for now. If prices rise considerably more and/or stock market crashes, maybe sell.
#2 keep.

Those are pretty darn good rentals even at their current market values. No reason to sell them unless you have something else you want to use the money for.

-W

trixs

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Re: Keep or Sell
« Reply #4 on: July 23, 2014, 07:26:40 PM »
Are those mortgages what you have left to pay, or what you put into buying the houses?

I payed $47K for one and $38 for another. Originally put 20% down on each and about $5k in renovations (painting/carpet). The extra income is great but I was thinking that it might be wise to sell and put the proceeds in the stock market. Although it would make since to wait until the next crash/correction. Regardless, I do wish I had bought more before the market rebounded.

Icecreamarsenal

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Re: Keep or Sell
« Reply #5 on: July 23, 2014, 08:21:29 PM »
I would buy them both off of you...so keep.

daverobev

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Re: Keep or Sell
« Reply #6 on: July 23, 2014, 08:30:18 PM »
Sell the first, keep the second.

gimp

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Re: Keep or Sell
« Reply #7 on: July 23, 2014, 08:32:02 PM »
I might either sell the first (see if you can't get over 100) or raise the rent a bit (see if you can't fetch a thousand a month.) Definitely keep the second.

arebelspy

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Re: Keep or Sell
« Reply #8 on: August 13, 2014, 09:50:15 AM »
Keep.  Consider selling the first if you have a better place for the money (i.e. if you could sell and buy two more just like it, in cash - probably not if you bought them a few years ago and prices have risen since then).

You're getting a good yield, if you have no compelling reason to sell, doesn't seem worth it.

What's making you consider selling?
We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with two kids.
If you want to know more about me, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
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AssetGrinder

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Re: Keep or Sell
« Reply #9 on: August 13, 2014, 10:05:33 AM »
Both have great yield. I would keep them and rent them for as long as the yield is high. I would pay down those mortgages at that rate or shop for rates under 3.5% to refinance if the numbers work out.