Should You Rent Your Home? If you, like 68 percent of Americans, own your own home, the thought has probably crossed your mind: if you were to be offered your dream job out of state, should you sell or rent your home? Naturally there are many factors to weigh before making such an important decision. First, you’ll want to think about your reasons for keeping ownership of the home. Do you like the home so much that you want to hold on to it in case you ever move back? Are you looking for an extra tax break through property depreciation? Do you want to use the home as a basis for retirement investment? These are all fine reasons for retaining ownership, but there are other factors to consider that may outweigh the perceived benefits. For instance, are you prepared to be a long-distance landlord, hiring someone to maintain and manage the property for you? There are other costs involved as well, such as advertising costs, turning costs (cleaning and painting between tenants), property taxes and insurance, utilities paid out of your pocket when your property is between tenants, and accounting costs. In order to assess these costs, you should research the numbers in your market. Expenses often run 30 to 40 percent of income before the monthly mortgage cost. The one time you probably would not want to rent out your property is if you’ve recently purchased it. Unless there’s a housing shortage in the market, the costs will outweigh the benefits to rent it out. The ABCs of Property Rental Okay, so you’ve decided to rent out your home. Where do you start? First, you need to get the house into tip-top shape in order to get the highest reasonable rent. This includes:
Should You Hire a Property Management Company? This is especially important if you’re moving far away from the house and won’t be able to keep an eye on things. It’s not absolutely essential to hire a property manager, but it can make your life a little easier. Ask for referrals, and interview at least three different companies (in the Yellow Pages under “Property Management”). Points you’ll want to cover during the interview:
Ultimately doing some homework, and discussing all your options with a trusted real estate professional will help you make the wisest decision based on your circumstances and goals.
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Real Estate •
September 27, 2019
Should You Rent Your Home?
