Because we owned our rental for reasons other than profit, I never really ran the numbers. I've now done that and am trying to figure out what to do. Because we are well into the loan (mortgage payment is ~50/50 principal/interest) it isn't as simple as dollars in vs. dollars out. We've now decided that we will never move back to the property, so we are now looking at it as purely an investment.
Rent (after mgt fee) 2255
Maintenance 75
HOA 165
Property tax 340
Mortg. interest 896
HELOC interest 100
Insurance 110
Income 2255
Expenses 1686
Net 569
We also pay about $900 per month on principal on the main loan, plus about $1200 on the HELOC (which was taken out as part of a refi which is a complicated story that isn't relevant). It is an IO payment so if cash ever gets tight, we can keep part or all of that $1200. HELOC is 2.6% adjustable. Mortgage is 4.2%, which is the best we could do with it not being owner occupied. Monthly cash flow is not an issue. While the house is way down (~$75k) from our purchase price, we are not upside down and could walk away with ~$150k, after all fees and expenses. Very rough estimates are that the home would sell for $475,000 and we owe about $300,000.
We will likely be moving back to the States in ~ a year and depending on where we land, we might rent or buy. If we buy, we would not have 20% to put down unless we sold (or sold a ton of stocks). However, we did not use a VA loan on our last purchase so we have that available to us. I'm not super familiar with VA loans or the implications, but my understanding is that using one would mean a lower down payment would not be a problem.
We'd buy something probably slightly more expensive than this property because it is an attached townhouse with no yard and we'd like a small yard for a dog.
1) Do we sell only if we decide to buy something else?
2) Do we sell regardless of whether we rent or buy at our next location?
3) Do we hold it regardless of renting or buying?
Thoughts?