The first thing you have to understand is that the amount you spent on the property has absolutely no nothing to do with the decision to sell this property or not. Get it out of your mind. Pretend you paid $1,000,000 for it, or pretend it was a gift. Whatever works for you, do it.
If you don’t understand why – read a finance book on “sunk cost” and internalize what it means.
OK. That’s out of the way.
Base your decision on the future cash flows the property will bring you under two different conditions:
1) you sell it and pocket the cash.
2) you don’t sell it and earn rent.
The analysis is now complicated by the fact that you don’t know how much you can sell it for. I’d recommend finding the break-even sales price. That is – if you sell for less than x, you will make more money renting it out, and if it sells for more than x, it is better to sell it.
Then, check the comps and put it up for sale at a price that will bring in offers.
