Should I Sell My Underperforming Rental in 2025?

After breaking down where rents are heading in 2025 and 2026 in Part 1, the next logical question I keep hearing from investors is:

“Jorge, should I just sell my underperforming rental?”

And hey—I get it. Not every property is a cash cow. Some feel like a leaky boat with tenants who don’t pay on time, maintenance that never ends, and rent that hasn’t caught up with your expenses.

But before you pull the ripcord and list it, let’s break this decision down with real strategy, not emotion.

🚧 First, What Do You Mean by “Underperforming”?

Let’s be clear:

A property isn’t underperforming just because it’s not making you a fortune today. Ask yourself:

• Is it cash flow negative after tax benefits and depreciation?

• Is it in a neighborhood that’s declining or losing tenant demand?

• Is the vacancy rate higher than 60 days consistently?

• Does it have repetitive tenant or maintenance issues that drain your time and money?

If your answer is yes to all of the above, it might be time to consider cutting it loose.

But if it’s just slightly negative or breaking even in a market like Central Florida?

You may be sitting on future gold.

🔄 Market Timing: Why Now Might Be the Worst Time to Sell

You’ve seen the data. We’re currently in a weird market cycle:

• Rental inventory spiked due to overbuilding in 2023–2024.

• Vacancy rose (especially in Pasco and Polk).

• Rent increases slowed to 2%–4% across the board.

So yes, you may feel like your property is “failing.”

But here’s what’s coming:

• Builders are pulling back, meaning less rental competition in 2025–2026.

• Multifamily concessions will dry up, pushing renters back into single-family homes.

• Demand is steady, especially in Florida’s job-growth metros.

• Rents are projected to rebound by late 2025, with even more growth in 2026.

📈 Translation: You might be months away from the rebound—why sell now?

📍 Let’s Talk Location (Because It Matters)

Here’s what I’m seeing in the counties we’re focused on:

Pinellas County (e.g., St. Pete, Clearwater):

• Tight supply, high long-term demand.

• If your rental is underperforming here, it may be more of a pricing or property manager issue than a market problem.

• Don’t sell. Fix the issue, raise the rent smartly, and keep it.

Pasco County (e.g., Wesley Chapel, Land O’ Lakes):

• Oversupply from recent builds, yes—but the population is still climbing.

• Consider modest renovations or improved marketing if your home is sitting.

• Give it 6–12 months. The tide is shifting back in your favor.

Polk County (e.g., Lakeland, Winter Haven):

• Vacancy has crept up, but this market is growing fast.

• If the home is livable and in a good location, rent growth will catch up.

• If the home is in a tough pocket? Then yes, maybe evaluate the exit strategy.

📈 Case Study: A Real Example from My Portfolio

I had a rental in Lakeland sitting for over 90 days in late 2023. I was ready to offload it.

Instead, I:

• Dropped rent by $50.

• Added smart locks and a fresh coat of paint.

• Gave a local leasing agent a $250 bonus if she filled it fast.

The home rented in 12 days. That tenant just renewed at a 3% increase and wants to stay another year.

Moral of the story:

Sometimes you don’t need to sell—you just need a sharper game plan.

🔍 Here’s When It Might Make Sense to Sell

Let’s be real—some properties aren’t worth the squeeze. If the answer to any of these is YES, you’ve got a legit case for selling:

• 🧱 Structural issues or massive deferred maintenance.

• 📉 Located in an area with declining rents or growing crime.

• 😤 A tenant base with high turnover, evictions, or legal issues.

• 💸 You’re sitting on equity and have a better opportunity elsewhere (like a 1031 exchange into a new build or better cash-flowing deal).

• 🔄 You’ve held it for years, depreciation is mostly used up, and the ROI just isn’t there anymore.

In that case? Run the numbers, consult your CPA, and consider listing while values are still strong. But even then, don’t fire-sale it. Time the market wisely.

🛠️ Not Selling Yet? Do This Instead

If you’re leaning toward keeping the property, here’s your 6-step tune-up checklist:

1. Re-run rental comps within a 1-mile radius.

2. Evaluate tenant quality—is the issue the property, or the people inside it?

3. Inspect condition—can a $2,000 facelift boost rent by $150/month?

4. Talk to your PM about pricing, marketing, and lease strategy.

5. Get tax help—you might be better off keeping it and using depreciation and cost segregation to offset other income.

6. Reassess in 6 months—set a calendar reminder now. Conditions will look different in Q1 2026.

🔑 Final Word: Ride the Wave or Cash Out?

Here’s my straight-shooting take:

If your rental is in a solid area, has long-term demand, and isn’t draining you monthly—you’re better off holding for 18–24 months.

This market is about to shift again.

Landlords who hold steady will be rewarded.

But if the property is problematic, mismanaged, or mislocated, and you’re staring at losses with no upside?

Let’s look at your exit plan.

Either way, don’t guess.

Want my eyes on the deal?

I’ve helped dozens of investors decide when to hold, fix, or sell.

Let’s run the numbers together:

👉 graystoneig.com/ceo

Keep it consistent, stay patient, stay true—if I did it, so can you!

Ready to connect and strategize? Contact me at graystoneig.com/ceo – Jorge Vazquez, CEO of Graystone Investment Group & its subsidiary companies and Coach at Property Profit Academy.

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