My wife and I own an investment property, a duplex, purchased in 1999 and paid off in 2008.
The gross rental income is $1,200 per month.
The house is currently in need of some foundation repair along a 12 foot section of basement wall, and will soon need a roof, as it was last replaced in 2000. I estimate these two repairs will cost $30,000.
The roof replacement will have to be depreciated over a period of 27.5 years. I think the foundation repair will be considered as a repair and be eligible for a same year deduction.
I am 51 and plan on retiring at 60. My plan was to keep the duplex and sell it once I retired. However, the above needed repairs are going to consume 25 years of rental income, just using gross numbers ($30,000 / $1,200 per month = 25 years.) And I'll still have the usual maintenance expenditures.
Using online resources, e.g. Realtor.com, Pennywise.com, etc, I estimate the house is valued at $128,000. I have not spoken to a Realtor.
I am wondering if it is in my best financial interest to sell the property now. Maybe I'm not looking at the situation correctly, but it seems to me I'll never recoup the cost of these repairs. I would like some educated opinions on what I should do.
