I own a two family in very good location in the suburbs close to Boston. I've owned for about 13 years. My wife and I paid off the principal on the mortgage thus own the house free and clear. A sale of the house would net roughly $540K after taxes. The two family provides about $2600 monthly after expenses.
We currently have a single family home with about $450K left on our mortgage at a very good rate of 3.375%, mortgage is about $3100 per month. My wife is very risk averse and would prefer to sell the two family and pay off the mortgage. I lean either way, but get sort of frustrated whenever I have to rent the apartment, which isn't often, but averages once every two to three years. The two family also will at point need updates, so future remodeling costs are definitely likely needed within ten years. In addition, I've been forgoing flood insurance in order to save costs.
So the scenarios would be:
A) sell two family, net $540K, payoff $450K loan on single family. Have no income from rental property but pay around $1000 per month in taxes and insurance on single family, and reinvest the remaining $90K. The pros are that the headache and risks of the two family are gone, our primary mortgage is erases. The cons are that we lose the rental asset and lose the income provided every month.
B) keep two family, continue to generate $2600 in monthly income and pay $3100 for mortgage...cost of $500 per month between two.
what would you do?