This Summer, Sell Away... Sell Away... Sell Away... or Rent?!

If a sailor’s skies are predicting a move in your future, your boat could be rocking between selling your current home or turning it into a rental property. Yes, when you’re moving up to a larger home, downsizing to a smaller home or relocating for any other reason, selling may seem like the obvious thing to do; but, some people find that renting their current home is a better option. Before your boat tips one way or the other, there are a few things that you should consider.

If you’re trying to decide whether to steer your decision toward selling or renting your current home this summer, here are a few things to assess:

Your financial situation. The decision to sell or rent can be made quickly if you do not have much support from your finances. If you’re banking on the profit from selling your home to help fund the down payment on a new home, renting may be ruled out from the get-go.

Your reasons for moving. Are you being transferred for work, but eventually planning to move back to the area where you have your current home? If that’s the case, you may be able to rent your home for a few years until you are ready to return. While that sounds great, keep in mind that you may not be returning to your home in the condition that you left it. Not all renters may take care of your home in the same way that you would.

Your market’s conditions. Get familiar with the conditions of the both the rental market and the real estate market in your area. Try to determine if property values are rising or falling. If they’re rising and the rental market is hot, renting your home may be a profitable option! If similar local property values are declining in value and it looks like that trend will continue, it may be best for you to cut your losses and sell now.

Your desire to be a landlord. Of course, you can hire a property management company to handle your tenant issues… but, that will cost you! So, if you intend to rent your home, you’ll instantly begin wearing the “landlord” hat. Is that a role you’re comfortable with? Think finding tenants, fielding phone calls at all hours, fixing various things as needed and sometimes, evicting tenants. When you choose to sell, those issues are non-existent.

Your projected rent. In addition to holding that “landlord” title, renting a home has some expenses attached to it. There are costs associated with maintaining a rental property, as well as the appliances and heating/cooling systems within. So, it is important to consider if the rent you’ll be able to charge will cover your mortgage payment and those extra costs. Sure, eventually, that mortgage will be paid off and the profit margin will increase, but you’ll need to decide if that is something you’re willing to wait for.

Your home’s condition. We’re not talking about needed repairs, because those are a must whether you’re renting or selling. Even if your home has some outdated features, that fact could weigh in on your decision to rent it out rather than update it to make it more appealing to buyers. Because renters don’t typically plan to stay in their rental property forever, they may be more inclined than buyers to look past outdated features in a home.

Yes, when it’s time to move, selling is probably the most popular option out there; but, it definitely is not the only option. By evaluating just a few factors, you may find that renting is the right route for you.

If you’re torn between renting and selling this summer, contact a Berkshire Hathaway HomeServices The Preferred Realty agent for some professional advice today!