We occasionally hear this from homeowners facing job transfers, or those considering for a variety of reasons — maybe they didn’t stay at their Cape house much last summer– to use their property to generate rental income, instead of selling it.
This is an option that has gained some popularity in recent years. According to a Harris Poll survey, 28% of homeowners have considered renting out their homes for additional income.
But is it a good idea?
Owning rental property can be tempting, but you may find the reality challenging. Here are some of the obstacles you could face, if you rent out your home instead of putting it on the market.
A Rental Comes with Responsibilities
Successfully owning and renting a house takes work. Think through your ability to make that commitment, especially if you plan to use a platform that advertises your rental listing. Most of them have specific requirements hosts have to meet, and it takes a lot of work.
Managing a rental property can be time consuming and challenging. Are you handy and live close-by to make some home repairs yourself? If not, do you have a network of affordable and reliable contractors you can reach out to? As homeowners, there are certain inconveniences that we are willing to put up with while waiting for a plumber or electrician. Your renters may not be that patient.
There’s also the responsibility of being a landlord, which means screening tenants, collecting rent, and other tasks. Are you willing do that? If not, you’ll need to pay a property manager to do it for you.
Your House May Not Be Ideal for Your Goals
Not every house ends up being a good rental. Are you thinking about using your home in a quiet residential neighborhood as an Air B&B? (Another idea we sometimes hear.)
If so, are you willing to field calls from former neighbors upset about that group of 20-somethings, who partied all weekend at your old house?
In addition, are you prepared to clean your former home in between renters? Or pay someone to do it? Are you going to be responsible for the landscaping? Or pay someone to do it?
In the beginning, renting sounds like a good idea. If you’re being transferred, for example, you tell yourself you can keep your Cape home and come back “someday.”
The additional income you have plans for? The roof will still need to be replaced.
Isn’t selling your home and putting the proceeds in your bank account a better idea? It’s certainly takes less time and energy.
Over the last few years, we’ve worked with several military families, who bought their homes from us when they were transferred to Joint Base Cape Cod. When they received new orders, some initially considered renting their homes. (One family was being transferred to Alaska!) But after we helped them sift through the options, they all decided to sell.
There’s a lot to consider before taking the leap and converting your home into a rental. If you are not ready for the work it takes, it could be wiser to sell. With the market readjusting — prices levelling off and mortgage interest rates dropping – – we’d be happy to help you review your options. Let’s connect at 508-360-5664 or firstname.lastname@example.org. Talk soon…
We don’t like to brag, but….
We’re grateful to all our clients who decided to make their move with Mari in 2022. Is 2023 your year??
Mari and Hank