How do we approach a cost-benefit analysis of rental property?
I retired recently & need help assessing whether to continue renting our duplex or sell. We still carry a mortgage but have about 2/3 its value in equity. We renovated in 2013 and have only been renting 1 side for 15 months, the other side part of the year. We own our unfinished retirement home outright.
Hi - I can't tell what you are really asking - why not continue to rent the duplex - with a rental property you have O.P.M. (Other People's Money) working for you. If you need funds to finish your home, you could refinance the duplex and use the additional cash to finish your home - and your renters will pay for it! You could of course sell the duplex and use the proceeds to finish your home, but then the Golden Goose Duplex (I assume it has positive cash flow and is profitable) will be gone. Good luck! | 09.26.14 @ 21:16
A CBA. Just use your Cash flow statement.
You can also do a NPV.
Some folks also use WACC- This one is more difficult due to the estimated discount rate, etc.
Send me a message to discuss. No obligation.
It's not what you make. It's what you keep that determines your lifestyle.
| 03.26.16 @ 00:30