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Cross-Posted to Buying/Selling Home

Let me first give you the facts. Me and my wife are currently 26 yrs old and own a home in Southern California, which we're renting out with a loss of $1,100 a month. If we were to sell it, we can get $100,000, which is the net of tax and commissions. We're currently renting an aparment for $1,200 a month so total housing related expense is $2,300 a month, which is 35% of our income. (Let me remind you that, in Southern California, it is extremely difficult to find a decent condo/house for $2,300 a month unless you get crazy monthly adjustable interest only loans.) We plan to move to the house in about 10 years but it's uncertain because you never know what's going to happen in the future. We can pay off the 2nd mortgage on this house in about 4 years, which means that the loss will be $450 assuming no rent increase. When we move to the house later in about 10 years, our housing expense will be about $2,300 and, by then, rent will be more than that for sure. If we were to sell this home, we'll probably hold on to the cash and buy a four plex later when rent and/or price seems more reasonable, if that happens at all. Well, this is the reality in Southern California.

So, what would you do in this situation? Sell it or keep it?

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