GlobalWealth
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Hey Bio,
This is my primary residence. I do own other property but this is where I live. I bought this place almost 5 years ago and it was my first purchase - I was 28 and it was just my wife and I. At the time, I hated the idea of up keep and plowing snow so we thought it was a good play. Now we have a little one and things changed. The thing is, I have cash to purchase another home without having to sell this, however; because of the unit I have and the market we are in I don't see these pushing 600k. So this is the cap I believe (525k) and as they get older, they may come down.
With the equity I have in this townhouse, if I rented for $3500 pm I would cash flow around 500 bucks a month presuming I covered cable, utilities, etc. If I sold, I'd make about $100k minus closing.
Would you sell and take the money and roll it into a better investment? Or buy something new and rent the townhouse for as long as you can and wait the market out.
Your property tax is almost $1000/m so you would have a hard cost of around $1200/m between tax and hoa. That leaves you with $2300/m gross. That is only a 6% roi, not great.
Considering your mortgage, as you say you would have a ncy (net cash yield) of $500/m, that is a 1.4% cash return on original investment.
If you can walk with $100k in cash, you can easily earn better than 1.4% on your cash and remain fully liquid.
I'd say selling is a no-brainer.