Leaving your current house and moving to another one gives you a few options. While most homeowners choose to sell outright, many opt to keep their old home and rent it out. It may be that there’s a strong rental market in your area, or you may have a hard time selling the house at the price you want. If you’re wondering whether to sell your house or rent it out, there’s a few things to consider.
What are the Rental Prices in the greater Raleigh area?
Does it make sense to rent your house? In many Triangle locations, rental prices can easily cover your mortgage payments. Depending on how much you have left on your mortgage, the rental income from your old house can cover the monthly payments, plus homeowners insurance and property taxes you pay.
Take a look at houses that compare to yours with regard to size and location. This should give you a ballpark figure on what price your house can lease for. If you aren’t on a tight timeline to leave your current home, take notice of how quickly similar houses in the area take to lease. If rental properties stay empty for more than a few weeks, you may have trouble finding consistent tenants.
Do You Need the Equity From Your Current Home?
Why are you leaving your old house? Are you purchasing a new home? If you’re planning to upgrade to a larger home, you may need the money from the sale of your old one to place a down payment on your new house. If you have enough equity in your current home, it may make more sense to sell the house, instead of renting it.
If you’re able to afford the down payment on your new home without selling your current one, usually about 20%, then renting out your old one makes sense. Also, if you don’t owe a lot on your current mortgage, then you’ll have a substantial amount of money after the sale of your home, which you can put towards a new one or set aside for other needs.
Will You Live in the House Again?
Consider if you plan to live in the house or in the area again. You may be upgrading to a larger home to raise children, but when they’re grown and have left the house, you may wish to have your smaller old home to downsize into retirement. Or, you may be in a situation that requires temporary relocation, and you’re planning to move back to the original home in a few years.
Having a good tenant to live in the house can ensure that your home stays in good condition, instead of sitting empty. You’ll also have the income from the rental property, building equity in the old home and your new one.
What Makes a House a Good Rental Property Investment?
Does your house have the potential to be a good income property? There are few things to consider before listing your house for rent. You may have to do some minor repairs and upgrades to your property to attract good tenants who will take care of the house and pay on time. Fresh paint and carpet are usually a must and are required in some areas.
The location of your investment property is one of the most important things in determining whether you’ll have steady tenants or whether you’ll be responsible for covering the mortgage out of pocket when the house sits empty. The desirability of your location can easily make the difference between having a steady tenancy and losing money on the rental property.
Deciding whether to sell your house or rent it depends on making a careful analysis of the area and the desirability of the property itself. You’ll also need to take a look at your finances, and determine if selling or renting will gain you the best return on your investment. Property Specific Realty can help you sell or rent your home! Our Brokerage & Property Management team is ready to help you make the best decision for your specific scenario!