BiggerPockets Real Estate Podcast

907: Seeing Greene: $100K In Equity But NO Cash Flow, Should I Sell?

Mar 5, 2024

Real estate investors discuss handling properties with low cash flow, maximizing tax benefits, diversifying portfolios for risk mitigation, and strategies for property appreciation and cash flow optimization.

41:35

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Episode guests

James Dainard

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Quick takeaways

Consider selling a low-cash flow rental property for a more profitable investment leveraging equity.

Maximize rental income by increasing rent rates, property value, and timely rental property advertisement.

Balance short-term cash flow with long-term equity growth for financial success in real estate investing.

Deep dives

Considerations for Renting Out Your Current Property

If you find yourself in a situation where your rental property might not generate enough income initially due to low rental values, it's essential to consider your options. Selling the property to leverage the equity for a more profitable investment, maximizing rental income by exploring options like increasing rents or adding value to the property, could be wise choices. Additionally, if you plan to retain the property and convert it into a rental, ensure that you understand when you can start counting expenses against the rental income.

Introduction

2min

Navigating Challenges in Real Estate Investment

6min

Real Estate Portfolio Diversification and Risk Mitigation Strategies in Changing Markets

6min

Maximizing Tax Benefits and Reinvesting for Real Estate Portfolio Growth

9min

Equity and Value in Real Estate Transactions

7min

Real Estate Investing Strategies for Property Appreciation and Cash Flow Optimization

12min

Where’d all the cash flow go? More than ever, rental property owners are waking up to find less and less mailbox money coming in every month. This is doubly true for those who used low down payments to house hack and turned their properties into full-on rentals. So, what do you do if you have a rental property giving you low, no, or negative cash flow? Should you sell it and swap it for another investment or ride it out, betting on future appreciation gains? We’re giving our thoughts in this Seeing Greene!

As always, David and Rob are here to answer your pressing real estate investing questions. But resident yacht tycoon James Dainard also brings his twenty years of investing experience to the show to help this week’s rookie real estate investors. First, our very own Noah Bacon asks what he should do with a negative cash-flowing house hack that has six figures in tax-free equity. Then, we ask a question everyone wants an answer to, “WTF is wrong with investors these days?” If you want to turn your house into a rental property, stick around because two more investors ask whether it’s worth it AND when you can start writing off those lucrative real estate tax deductions.

Want to ask David a question? If so, submit your question here so David can answer it on the next episode of Seeing Greene. Hop on the BiggerPockets forums and ask other investors their take, or follow David on Instagram to see when he’s going live so you can jump on a live Q&A and get your question answered on the spot!

In This Episode We Cover:

Whether to keep or sell a rental property that’s losing money every month

Appreciation vs. cash flow and why SO many new investors get this wrong

How to minimize your chance of negative cash flow by buying in THESE areas

Why some real estate markets appreciate while others rarely see price growth

Whether you should turn your primary into a rental property or buy an investment property instead

Real estate tax deductions and how long you have to wait to write them off

And So Much More!

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