Should You Sell Your House or Rent It Out?
Fall is the Best Season in Tampa Bay for Buying and Selling!
Should You Sell Your House or Rent It Out?
When it’s time to move, deciding what to do with your current home is no small task. More homeowners today are seriously considering renting out their properties instead of selling. In fact, recent data from Zillow shows that 66% of sellers thought about renting their home before listing, with 28% seriously entertaining the idea.
This growing trend reflects the potential benefits of keeping a home as a rental property. But does it make sense for you? Let’s explore the key questions to help you decide whether selling or renting is the right move for your goals.
Is Your House Rental-Ready?
First, consider if your house is a good candidate for the rental market. Ask yourself:
Is the neighborhood desirable for renters?
Does your house need major repairs before it’s tenant-ready?
Are you prepared to handle ongoing maintenance or hire a property manager?
If you’re moving far away or your home requires significant work to attract tenants, selling might be a more practical choice.
Can You Handle the Responsibilities of Being a Landlord?
Renting out a property isn’t as simple as collecting a check each month. Being a landlord comes with responsibilities, including:
24/7 Maintenance Calls: Repairs don’t wait for convenient hours, and you’ll need to address tenant issues quickly.
Tenant Management: Late payments or broken leases can create unexpected stress.
Property Upkeep: Damage or wear and tear can require costly repairs between tenants.
As Redfin explains:
“Landlords have to fix things like broken pipes, defunct HVAC systems, and structural damage. If you don't have a few thousand dollars on hand to take care of these repairs, you could end up in a bind.”
Do You Understand the Costs?
While renting your house can provide passive income, it’s important to understand the financial realities. Here are a few costs to keep in mind:
Mortgage and Property Taxes: These don’t go away, even if the rent doesn’t cover them.
Landlord Insurance: Typically 25% more expensive than regular home insurance, it’s essential for protection.
Maintenance and Repairs: Budget for at least 1% of the home’s value annually, or more for older properties.
Vacancies: When the property is unoccupied, you’ll need to cover the mortgage yourself.
Property Management Fees: If you hire a property manager, expect to pay around 10% of the monthly rent.
Considering these expenses can help you determine whether renting will deliver the returns you’re hoping for.
Bottom Line
Choosing to sell or rent out your home is a big decision that depends on your financial and lifestyle goals. Each option has its benefits and challenges, and the right choice for you will depend on factors like market conditions, costs, and your long-term plans.
If you’re weighing your options, let’s connect. We can walk you through the pros and cons, review your property’s potential, and help you make a confident decision.