Sell Now or Hold and Rent?

Put what a seller nets today, at each price they might accept, next to what holding and renting actually returns — run as a conservative and an optimistic case, with the investor path modeled alongside.

Your numbers Updates as you type

Low, middle and list. All three appear side by side in the results.
Percent of sale price. Applied to the sale today and any later sale.
The most likely outcome. Everything below measures holding against this one.
Optional. Shows the gain over their purchase.
24 months
160
Annual return if they sold today and parked the cash. Set this to 0 to compare on cash flow and appreciation alone.
Debt service. Excluded from NOI, included in cash flow.
Entered annually, prorated to a monthly figure everywhere below.
Context only, shown beside the rent assumption so sellers can see where it sits against the leased comps.
Percent of rent actually collected, so it scales with each case.
Negatives are fine — enter -4 for a 4% decline.
What an investor in this submarket underwrites to. A lower cap rate implies a higher price for the same income.

Holding 24 months vs. selling today

Conservative

$0

 

Optimistic

$0

 

 

If They Sell Today

Three price points

 

If They Hold and Rent

Monthly
Line itemConservativeOptimistic

Net operating income is after operating expenses and before debt service — the figure an investor underwrites. Cash flow is what reaches the owner's pocket.

Months Until They're Ahead

How long the rental has to run before cash flow and appreciation beat what they'd have netted by selling today and putting that money to work.

Measured againstConservativeOptimistic

 

The Crossover

—

Each line is the running advantage of holding over selling today. Above the dashed line, holding is winning.

Conservative Optimistic Selling today

Market Outlook

Projected value

Projected from the comparison price.

The Investor Angle

A documented year of rental income lets an investor underwrite on cap rate rather than on comparable sales. This is what that income stream is worth to them.

Line itemConservativeOptimistic

 

Key Figures

Net proceeds today$0
Break-even · conservative—
Break-even · optimistic—

What this does and does not count

  • Net operating income is rent less vacancy less operating expenses, before debt service. Taxes, insurance, HOA, maintenance and management are all operating expenses; the mortgage payment is not.
  • Property taxes are entered annually and divided by twelve wherever a monthly figure appears.
  • Selling today and selling later carry the same closing cost percentage, so commission is netted out of both sides rather than ignored on both.
  • Holding is measured against selling today and earning a return on the proceeds. With that return set to zero, waiting looks free whenever the property cash-flows at all.
  • Any mortgage balance and payoff is not modeled. Net proceeds are shown before loan payoff and the full payment counts as cash out, so equity built through principal is not credited.
  • Rent, vacancy and appreciation are estimates. Taxes on the sale, depreciation recapture and 1031 treatment are not modeled. Talk to your CPA.

Comparative analysis for discussion only · Not an appraisal, a commitment, or tax advice · Smith & Associates Real Estate