Should I sell my rental home in 2023?

I love talking with my clients about many different real estate scenarios! A client posed this question to me last week, and the answer is…….maybe. 

The right investment properties make excellent college funds! Basically, the tenant should be paying enough rent to cover the mortgage with insurance and taxes, as well as provide enough funds for minor repairs. The owner is able to build equity through rent payment, and hopefully realize some appreciation as well.  As the landlord, you have the risk of maintenance, taxes, insurance, and of course lost rents due to non-paying tenants. 

With the real estate market being red hot, if you have equity in your rental home, should you go ahead and cash out now, and invest your money other places? 

If you are investing for the long-term, the answer is NO. Although prices might be enticing, keep your property for the long term. Consider a cash out refinance or home equity loan if you want or need some extra cash. 

IF you are going to sell your investment home, YES sell your house NOW while prices are HIGH and inventory (number of homes for sale) is LOW. 

Why would you sell? 

1. Take the equity and pay off debt. 
2. You are tired of being a landlord.
3. You are looking for a different investment property, and are pursuing a 1031 exchange.

Every investor’s financial goals are different, and it is important to carefully consider all options before making a decision!