I have a vacant rental that's remodeled and ready to do something with and make a decision. It is practically in flip condition, except it has new laminate counters instead of stone.

I'm on the fence on whether to keep or sell. I've been trying to brainstorm and do a cost benefit analysis of what to do, but I'm still kind of stuck. Here is my list of pros and cons. I've done them in order from most important to least important. I would appreciate any input. Thanks!

Pros of Selling:

1) My rental is one side of a duplex. Someone else owns the other side (separate deed). I have no control over what/who happens on the other side in the future. It is currently a rental owned by an out of state accidental landlord, so it could be sold to who knows who at any time. Unfortunately me buying the other side is not an option any time in the foreseeable future.

2) Septic system and huge oak trees. No issues at this time but could be expensive if something ever did go seriously wrong.

3) Economy/housing market could go south in the next couple years (no idea), might be harder to unload then if it came to that.

4) It is in flip condition, and it is almost summer. It will be easy to sell now.

Pros of keeping it:

1) If I sell it I lose the income stream. It is a bird in hand, as opposed to taking the money and having to figure out what to do with it.

2) Rents have been going up in this area, although wages here have not kept up.

3) Should show well as a rental and it is summer, so many qualified applicants.

If you think you will sell sometime in the future, then the time to sell is as soon as you finish renovations.

The minute you put a tenant in there, the house gets worn and it doesn't take long before the decorating is tired.

If you rent it out, when you go to sell it, you will probably have to repaint, maybe replace carpet and there might be burns in those countertops.

Thanks. The out of state owner's tenants have not been an issue for me. There have been several groups of tenants there over the years. I met the owners before they moved to Texas. But I doubt they will keep this place forever and when they sell who knows what I could end up with next door.

There is another half duplex on the street about 3 doors away that was bought about 2 years ago. These owners run an auto repair business ON THE STREET, not on their front yard. They have poles and an awning set up over the junk cars. My concern is that the neighborhood could be going downhill and I could get someone like that next to me someday.

No I don't think I would do 1031. I could use the cash to help pay down my mortgage, if I wanted to do that, and I will need to two reroofs in the next couple years on other rentals.

It sounds like this is the time to sell if you were to do it. Having the cash on hand for the other repairs is always a plus. If you don't think you can cover those repairs with the current cash, then I would say sell.

Owning half a duplex does sound like trouble coming. I would not want to deal with those issues.

As I get older, I realize I want to deal less and less with getting tenants and sifting through them. The ones I have are great, so I am happy to keep those. But I do dread looking for new ones. Do you feel the same?

The tax bite of selling hurts, but there is less problems after that, you walk away and enjoy yourself.

Thanks Linda. The tax part is unfortunate but I'm prepared for it...

I hate looking for tenants for this particular unit because I always get a bunch of deadbeats applying for this place, or else very young, immature acting people. I don't know if that was because the interior didn't show well (there were some cosmetic problems back then), or the "duplex factor". I think these neighborhoods that are all duplexes around here can be kind of seedy and attract a slightly lower quality tenant than you can get at a SFH. And there's no garage so that could be a turn off too.

It sounds like you are leaning more towards selling so maybe that is the way to go.

So if you own both sides do you have two deeds?

What if it needs a roof and the other owner does not agree?

Yes one person would have two deeds...

J, read back through everything you wrote in this post. I think you'll decide that selling is the right choice.

Thanks JB. The fact that no one (especially the ones right next door!) has called code enforcement on the new street auto repair shop says it all to me. Especially since sometimes these folks hang out in the street and oncoming cars have to wait for them to get out of the way. It speaks of an "I don't care" attitude in the neighborhood.