The specific angle that I'm interested in is the comparison of selling with the intent of investing our equity in the house vs. renting and using the house as a source of passive income in FIRE.
Market Value: $230,000
Original Purchase price: $260,000
Original Mortgage Amount:$176,000
Interest Rate: 2.875%
Mortgage Term: 15 years
Term remaining: 12 years
Amount remaining on mortgage: $155,000
Gross Rents:$1,500/month ($18,000/year)
Principal and Interest: $1,205/month ($14,460/year)
Taxes and Insurance (the T&I of your PITI): $232/month ($2,784/year)
HOA costs: $70/month
Deferred maintenance notes: None
Anything else special or unique in regards to the numbers of the property (not the property itself; things such as city assessments, back taxes, special costs due to unique features of the property, etc. etc.): None
If we kept the property and rented it, the mortgage would be paid off in 2028, with positive cash flow after that. I would be a long distance landlord (out of state) but both my wife and I have parents 30 minutes from the property so frequent visits to the area will occur anyway. I've seen the number "50% of gross rents" tossed around on here as expected income. I'm not buying that in this case. It's a townhouse, and I could replace the entire roof, and every appliance in the house, every year for $9,000. I also do most work myself.
What I'm really interested in is the argument comparing selling and investing my equity vs. renting for passive income. By my calculations, it seems like the equity invested over time (I'm 31, long time to compound) is comparable to the "stash equivalent" that would provide, say, $12-15k a year in income that this rental would generate. I'm down with all the tax implications on renting. I've done spreadsheets on the depreciation, possible maintenance costs over time, etc. Essentially, I'm pursuing whichever option will ultimately result in the largest benefit to my stash. Maybe I haven't overlooked anything and it just comes down to choice but I've already learned so much on this forum that it's silly not to ask.