‘My rental income is around $2,600 a month’

  • The homeowner is considering whether to sell their rental property with a 2.6% fixed interest rate for 10 years
  • The rental property generates a positive cash flow of $400 per month after deducting expenses
  • Keeping the rental property provides diversification, potential home-price appreciation, and a steady stream of rental income
  • Selling the property may allow the homeowner to avoid capital gains taxes and reclaim depreciation expenses
  • Investing in the stock market is another option to increase wealth, but comes with volatility

The homeowner is faced with a decision of whether to sell their rental property with a 2.6% fixed interest rate for 10 years. Despite living in another state, the rental property generates a positive cash flow of $400 per month after deducting expenses. Keeping the rental property provides diversification, potential home-price appreciation, and a steady stream of rental income. Additionally, the homeowner can use the property to take on a second lien if needed. However, selling the property may allow the homeowner to avoid capital gains taxes and reclaim depreciation expenses. The decision also depends on the homeowner’s experience as a landlord and their ability to handle property management remotely. Investing in the stock market is another option to increase wealth, but it comes with volatility. Ultimately, the homeowner must weigh the pros and cons and decide whether to sell or keep the rental property.·

Source: https://www.marketwatch.com/story/i-own-a-rental-property-with-a-2-6-interest-rate-fixed-for-10-years-but-i-live-in-another-state-should-i-sell-it-227531ee?mod=newsviewer_click
Factuality Level: 2
Factuality Justification: The article provides personal advice and opinions on whether to sell a rental property or keep it, without presenting a balanced view or considering individual circumstances. It lacks objectivity and contains biased information presented as universally accepted truths. The article also includes unnecessary details and repetitive information, making it less informative and more opinionated.·
Noise Level: 3
Noise Justification: The article provides relevant information and analysis on whether to sell a rental property or keep it, considering various factors such as rental income, mortgage rates, tax implications, and market conditions. It offers insights on the pros and cons of each decision, backed by data and expert opinions. The article stays on topic and provides actionable advice for the reader.·
Key People: Aarthi Swaminathan (Columnist), Ryan Janus (Certified Financial Planner at Janus Financial Services), Peter Earle (Senior Research Fellow at the American Institute for Economic Research)

Financial Relevance: Yes
Financial Markets Impacted: Real estate market, mortgage rates, stock market
Financial Rating Justification: The article discusses financial topics such as real estate investment, adjustable-rate mortgages, rental income, capital gains taxes, and the potential impact of selling a property on the stock market. It also mentions the Arizona housing market and U.S. equity prices.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification: ·

Reported publicly: www.marketwatch.com