House: Sell and invest or Rent? Long Post, apologies

[mizuki777]

100% sell and invest. The costs stack up fast, the insurance hits hard, and holding a place you never plan to use just drains your money for no reason.

 

I had a similar property and I sold it through Cash Offer Kentucky because I wanted a clean exit and a fast payout. It cut out the stress and let me put the money into something that actually grew. If you want the simplest path, that kind of direct sale makes everything easier.

[Rod Hagen]

23 hours ago, mizuki777 said:

100% sell and invest. The costs stack up fast, the insurance hits hard, and holding a place you never plan to use just drains your money for no reason.

Thank you.  I did!  I received more than asking and now the money is invested.  Happy Ending. Being a Landlord, much less someone running an AirBnB, would have driven me nuts.

[+ nycman]

18 hours ago, Rod Hagen said:

I received more than asking and now the money is invested.

Congratulations and thanks for the update!

[Rod Hagen]

On 2/26/2025 at 10:33 PM, hungry4darkmeat said:

Gods not making any more land 

I was rereading the posts this morning and had missed this line :-)

[+ Vegas_Millennial]

2 hours ago, Rod Hagen said:

On 2/26/2025 at 10:33 PM, hungry4darkmeat said:

Gods not making any more land 

I was rereading the posts this morning and had missed this line 🙂

New land is created every year around the globe.  But who owns it?:

Volcanoes create new land, but who owns it? - Punctual Abstract

WWW.PUNCTUALABSTRACT.COM

---

Tens of thousands of tons of molten rock have flowed into the Pacific Ocean, hardened, and created new...

 

 

[+ PhileasFogg]

“Keep or sell” isn’t a one-dimensional question to me. Returns from real estate come from a mix of cash flow and appreciation—those are the only two variables that matter.

In my view, as an investment,  right now housing is something to hold, not something to buy, unless it’s a truly special situation. Inflation favors tangible assets, and rents should rise over time as inflation pushes incomes higher. That said, post-pandemic valuations are still elevated in most markets relative to the cash flow a new purchase can realistically generate.

When I evaluate deals, I frustrate my realtors because I focus on a single metric: cash-on-cash return. I don’t care what “market cap rates” are or what owner-occupied comps suggest. For me, real estate is just one alternative among many investments, each with its own balance of risk, cash flow, and appreciation potential. Real estate tends to be risky, high-maintenance, and illiquid—so I need to be paid a premium for taking that on.

A current example: I’m looking at a property in New Orleans’ French Quarter—about 240 years old. Buyers from California purchased it in 2015 for ~$700k and spent three years renovating it into three rental units. They listed it last year at $1.2M and have since dropped the price below $800k. I told the realtor my number would be closer to $500k.

Why? Gross market rents are only around $70k/year, while insurance and property taxes alone run ~$22k/year. After management, maintenance, vacancies, and reserves, the risk-adjusted return doesn’t come close to what I can earn in a boring CD—with none of the headaches.   I’m not advocating CD yields…but I want something considerably higher from real estate. 

Edited December 15 by PhileasFogg

[hungry4darkmeat]

On 12/14/2025 at 2:46 PM, Vegas_Millennial said:

New land is created every year around the globe.  But who owns it?:

 

A - that’s not real land and won’t stand the test of time and 

B - I was really referring to the livable land mass available on the earth which is evolving but still pretty finite- it’s really the most valuable of all earthly commodities because you can use it to support yourself in so many different ways from living off of it yourself to developing it for commercial, residential, agricultural or industrial purposes - no matter what happens to all of that you still have the land and probably the air rights- but most importantly the ownership of the SPACE on the planet. that’s something that there is a finite amount of and if it’s land it can and will likely regenerate itself in most cases relatively quickly no matter how badly we fuck it up.
 

But I digress… my apologies- I just tested my first legal cannabis crop and it’s something else 🤩

[MarkBottom2025]

I would make sure that renting the home is actually giving u an ROI.  Calculate that including any tax advantages from renting.  Then figure out how much u can get for the home by selling it and what it would earn in a no risk money market. Compare the two and see which is a better option.  

[AtlantaDude]

On 2/26/2025 at 8:50 PM, Vegas_Millennial said:

The Chat failed to mention California Prop 13, which caps increases in property taxes to 1% each year.  I don't know if that applies to rental properties or not.

The Chat also didn't compare after tax dollars of both investments.  For investing, you can assume most of the earnings will be subject to lower capital gains tax rates.  For the house, it's a complicated game of deducting depreciation from the rental income as you rent, then paying taxes on it all when you sell, albeit still at the lower capital gains rate.  The rental income itself would be taxed at higher personal income tax rates.

The real benefit in real estate is if you intended to leave your assets to heirs.  Your heir could sell the house the day after the title is transferred to him, and he wouldn't owe any capital gains taxes because the base value of the house is reset when the asset transfers in probate.  Unlike stocks, where he would owe capital gains based on the difference between what you paid for the stocks and what price he sold them at.

Not correct.  One who inherits stocks also gets a stepped up basis as of the date of death.  

[+ Vegas_Millennial]

3 minutes ago, AtlantaDude said:

Not correct.  One who inherits stocks also gets a stepped up basis as of the date of death.  

Thanks...I did not know that!