Real Estate: Should I Sell My Duplex?
My husband and I took a chance and sold our beautiful single family rental in a B neighborhood to buy a duplex in a D neighborhood for $170,000 cash in October 2019. The roof was only 6 years old, but the AC's were getting up there. Everything else was in good shape, so we put $10,000 into reserves and started collecting $900 per side. With no mortgage, we were cash flowing pretty well.
Until April 2020 hit.
From April - June, a tenant's former girlfriend squatted and trashed the place with $2500 in damages. We went without rent until September, when we placed a new tenant. She paid rent until April 2021, and she's not living rent free. Turns out, it's hard to collect rent when you can't evict.
I decided to sell the duplex, but a buyer's inspection found termites, and the roof somehow needed replaced at less than 8 years old. We tented the duplex for $1200. We had the roof replaced for $12,000 - oh did I say $12,000? - the roof was done so poorly it needed $6,000 in additional wood. The previous owners hid the bad roofing job very well.
Now, we have a $1200 plumbing repair, and I am out of reserves.
The property is worth about $275,000. That's a lot of equity sitting in one place that could be leveraged. It's held in an LLC.
So should I sell it? I'm torn because we should be able to raise rent soon, and start collecting from both sides. We have a termite bond on it and a solid roof. It's a great, block property in an area one exit from downtown.
But when it rains, it pours, and this duplex has been raining on me for over a year now.