Multi Unit Investment Property in Los Angeles...

[Kash101]

I own a 4 unit apt building in a growing LA neighborhood that I bought right.. Been having a few problems with tenants, so we will be pursuing an eviction and re - rental on 2 units. This obviously mens we will be cash flow negative from this property for ~ 3-4 months best case scenario.

1. I can sell the property now and profit ~ 20% , should I do that and re-invest in another cash flow + assist from Day 1 ?
2. Rent control in my area will always limit appreciation of the build regardless of cash flow, wise to consider potentially less cash flow or cash flow neutral in a non-rent controlled neighborhood and bank on appreciation ?


Thank you

[ejbowlin]

It really comes down to your ROE.

Take your potential income and divide it by the total equity (minus selling costs). Then, compare it to your ROE in another asset.

In general, avoid places that are not landlord friendly as it will limit the long-term value of the property unless it's just a ridiculously appreciating market.