My father has an old single-family home he purchased at the height of the real-estate bubble. He lived in the property for about 5-years, refinanced to 3.25%, purchased another brand new home designed to his taste, and rented out the first home.
He loses about $250 a month between the rent and actual mortgage and has been making up the difference every month out of pocket.
Since he did purchase at the height of the bubble it has taken some time for the current value of the property to catch up or equal what he owes; it's almost there another 3 years and it will be about even.
Should I advise my father to sell the property now and pay the $15k loss on it at closing?
Should he wait 3 years and break even?
Or should I tell him to just keep renting it for the next 10-15 years?
If he keeps it for another 10-15 years he will be sitting on $100k equity from his first home and his new home is on its way to have another $100k in equity. Both homes are in an area where value of the homes are going up. It would be nice for him to be able to cash out and move out west and buy a house without a mortgage.
He can easily afford the $250 a month. What should I tell him to do?