Does anyone else own a rental property that is massively over-appreciated to the point where it doesn't really make sense to own anymore?
I know I should sell mine, but I'm not really sure I'd know what to do with the proceeds from the sale. RE-wise, nothing really cashflows in my immediate area, or the area where the house is located. The stock market seems like an obvious place, but without leverage, it seems inefficient. There's also significant exposure if all of my savings are in the stock market, I like the diversification of my setup right now. The tax benefits are nice too, and with a low interest 3.5% loan, principle paydown is no joke, I'll make $5000 in equity by the end of next year.
Lastly, from a touchy-feely standpoint, I've worked my ass off to take it from shitheap to a pretty nice property, and it will most certainly be bulldozed if I sell it (its in one of the nicest neighborhoods in town) and I think that would be tough to see.
I plan to keep it another year, maybe see what happens. Am I nuts? You guys can tell me. Here are the numbers, in case you're wondering-
Rent: $2500
Original Purchase Price: 254000
P&I: 1392.04
Taxes (annual): 2989
Insurance (annual): 802
Maintenance Budget: 3500
Vacancy: 8.4% (one month per year, though I've never actually had it this high)
Cashflow: $290.38
Annual Profit Minus P&I: 3484.54
Here's the nutty stuff:
Mortgage Balance: 310,000 (cashed out)
Market Value: 465000
Current Sale Profit with Realtor Fees: 127100