I am so glad a friend of mine referred me to this site. I've been battling with a decision for months and have yet to find an outlet to get advice...until now. I want to thank you all for your inputs/opinions ahead of time. Here's the skinny:
I have a house that I owe $200K on, but it is worth $370K. I nice $170K in equity ain't too shabby. However, I no longer live there and am currently renting it for $2500. I'm only profiting $400mo on the rent because of property management fees (I live out of the area), mortgage payment, taxes, and insurance. So, it is bringing in $4800yr. I haven't had any maintenance issues, but I'm sure they will occur and that profit will be much smaller. Also, I need to save the $4800 in case my renters move out and it takes me 2mo to find new ones. I re-fi'd for a 3% rate and now have 14yrs left on the loan until it's paid off. After it's paid off and with inflation, I could probably clear close to $3000mo on this or $36K year. I'm 36 so I'll be 50 when it's paid off.
I will be earning a pension when I am 39 but it is only $2000mo for the rest of my life...$24K yr. That will make $50K yr take-home when I'm 50. I'm also investing and should have $500K by the time I'm 50 if I keep it up.
My question is do I sell my house, take the $170K in equity and invest it in a Roth IRA or stock market or do I hang onto the house and keep renting it? Putting up with the stress of renters, possible maintenance, and the fear of it sitting empty for a couple months while new renters are moving in. Taking the $170K is tempting because it's stress free sitting in a fund and watching it grow over time at an average of 6%-10%.