Hello, I was wondering if I should sell one or both of my properties, not sell them at all, take out the equity, save the money and declare bankruptcy factoring in rising interest rates, its becoming more of a buyers market soon, stress and expenses of being a LL, appreciation, I haven't found another job yet, and just basically all the pros and cons of being a LL vs working a 9 to 5. I rented out the bedrooms individually in both of my residential homes for better vacancy buffer and more profit. I lived off the rental profits for a little over 2 years after my 60k job was terminated when the company closed. Below are most of the numbers for the properties and more information on my situation.

I purchased my first rental 7 years ago

purchased for 90k,

rate 4%,

78k remaining,

5 bed,

2 bath,

1600sq ft,

nice quite neighborhood,

mortgage of $700,

utilities average of $300,

Worth approximately 130k

rented out the bedrooms individually for better buffer and more profit.

Second home purchased 2 years ago for 220k.

rate 4%,

200k remaining,

6 bed,

3.5bath,

3000sq ft,

nice quite, upscale neighborhood,

mortgage of $1400,

utilities average of $400,

Worth approximately 260k

The smaller property was brining in $800 profit each month and the larger was making 1200 a month when totally full and tenants paid. Factoring in vacancies and non paying tenants which I had 3 in 2017 not pay for months and had to evict them, I made about 1400 a month pure profit. However, recently in September 2018 I had both homes go totally empty, father was diagnosed with cancer in prostate hip and spine, aunt getting cancer in her neck, threatening to get sued by evicted tenant, both homes needing lots of repairs, girlfriend of 3 years ending the relationship, getting hospitalized, mother getting hospitalized for chest pains, and losing almost all my life savings since then paying the mortgages and trying to fix them up.

Since the American dollar depreciates in value and the cost of construction rises, over the long run:

rents will rise

tenants will pay off the mortgage

and you will build equity.

First first house cost me $72,000 with a $15,000 down payment.

I exchanged that property and purchased a larger home while taking $75,000 out through a re-finance --that's tax fee.

Then I sold that second property and walked away with $530,000, pre-tax.

I am reading between the lines, so my thoughts are you should sell them.

Generally speaking, we folks who hold onto houses for the long run will mention some part of the business that we enjoy. People like myself love working on homes.

That said, it is a good time to sell in that homes are selling quickly. You can return to the rental business when nobody wants to buy houses and most likely buy-in at a low price.

On a side note. I don't like single family homes that rent to families for large sums. If you have a home which needs to be rented by the room you may have a nice place but not an easy to manage, easy to rent home.

No matter what the size of the shacks I have, each one of my residents doesn't need a ton to live there, so if they don't pay, they risk moving to a worse location or home. If your large home tenant could always find something comparable then they are not feeling the pressure to pay and stay.

So the question is, Do you own a silver car in a sea of silver cars or do you have the only green car in town?

"take out the equity, save the money and declare bankruptcy"

No. Not honest and probably illegal.

"sell one or both of my properties"

Depends. Neither one has the profile of a good rental house. Too many bedrooms and too expensive relative to the rents you're collecting. You only cleared $9600 on the 260K house. By way of comparison, my houses typically net $6000 for an all-in price of $40K. If you want to develop a source of income from rentals, you need to invest in an area that has higher rent/purchase price values. Areas that aren't quite as nice. If your properties aren't at least paying for themselves, you need to dump them.

That said, you could definitely improve your marketing. Craigslist in most areas only attracts the dregs. Are you posting on Zillow, which syndicates to other sites? Facebook Marketplace? Have you put up flyers at the local Wal-Mart, factory, etc.?

If you sold both of your properties, you'd have maybe 80K in equity. The challenge is that, without a job, you're going to have a hard time getting the leverage you are enjoying now. It's premature to go full-time as a LL. You need more properties so that you have more of a cushion.

My suggestions would be (in this order):

--find a job

--while you're looking and the properties are vacant, start doing some of those needed repairs. If you don't know how, go on YouTube and educate yourself. There are very few things you can't learn how to do.

--sell the most expensive property

--bank the return. Avoid the temptation to live off of it!

--start looking for properties that offer better investment returns

John of VA

Its becoming more of a buyers market soon...

stress and expenses of being a LL, appreciation...

I haven't found another job yet...

Worth approximately 130k $800 rent;

Worth approximately 260k $1200 rent;

Are the rents at fair market for your area?

The asking prices at fair market for the area as well?

evict tenant? Have you been screening the tenants or just trying to fill vacancies?

cancer? of Course good tenants that are screened properly can hit a bad time. BUT your screening process may have been an issue with 3 evictions.

both homes needing lots of repairs??? losing almost all my life savings since then paying the mortgages and trying to fix them up. If you can paint the units to make them look good and presentable. IF you just use a tinted primer to clean up the units.

I haven't been able to find any qualified renters. I've done my same ad on Craigslist with the same pictures for years. Change your ad it shop worn. And drop off filers to employers in your area.

If you are near DC you may want to advertise in the DC area since prices are much higher than your area. However if the commute is to far than this is not a solution. Some people are willing to travel an hour or two for work IF the cost of living is less fro them.

Take some pictures and post them on this site. IN the double red box POST YOUR PICTURES

AND VIDEOS

Let us SEE what

you're saying! Refer

others to your page.

Also post the picture of your rental you use on craigslist.

And a copy of your rental ad DO NOT post your phone number on here when you post a copy of your ad.

Hello,

Are you sleeping well at night with that HUGE responsibility on your shoulders? If you are and you like the cash flow, you might even want to grow the business in the future.

If you are too stressed out and hate being on call because you are a free spirit - perhaps you should sell.