If you own a house that you don't intend to live in, you're no doubt weighing your options on how to address this property windfall. Our Leesburg property management services are here to help you make the right call—and make the process as easy as possible.
- Are you the proud owner of a starter home your family has outgrown?
- Do you own a giant house that feels empty now that the kids have moved out?
- Were you gifted your parents' house as part of an inheritance?
- Are you being forced to rethink your location due to a career change?
Regardless of the reason for this major life change that has left you with a spare home, you're probably wondering: "Should I rent my home or sell it?" The answer to this big question actually depends on several smaller questions and their answers.
In today's blog post, we'll be taking a look at some tough (but important) questions that we find new landlords often face when considering what to do with a spare home.
1. Will Renting Be Profitable?
Renting is just like any business in that your revenue must exceed your expenses in order for that business to be profitable. Therefore, before you decide to rent your home, you need to know what your home will rent for. You can get a pretty good idea by comparing your home to similar units that are available for rent in your corner of Leesburg. Once you've done that, you can factor in the expenses associated with renting a home, such as:
- Mortgage payments
- Property taxes
- Mortgage insurance premiums
- Landlord insurance
- HOA Fees
- Maintenance and repairs
- Advertising expenses.
If your home looks like it will be immediately profitable as a rental property, that's a great sign. However, even if it doesn't, don't write off renting it out right away! Your rental business can grow over time if the conditions are right, and according to Reuters, it makes sense to rent your home out if the rental income you generate will cover 80% or more of the property's expenses.
It's also a good idea to look at historic rental trends in your neighborhood, city, and region. Does it look like rent is going up? If so, that's a sign that your rental property will become more profitable as time goes on. It's also worth keeping in mind that certain costs you incur to rent your home (like Leesburg property management services) are tax-deductible. That will significantly reduce what you will pay in income tax on rents received.
2. How Does the Future Look?
In some cases, you may simply not be ready to sell. That could be because of an emotional attachment to the property, but for many homeowners, it comes down to market conditions. Even if you're emotionally ready to sell, does the market say that now is a good time?
Predicting the real estate market is always a tricky business, but you should always analyze your local housing market before you commit to selling your home. If you're in a strong seller's market, you might do well to list your house sooner rather than later. If not, there's every likelihood that the market will swing back around if you give it time, which will make selling your home much more profitable down the road.
Even if your long-term goal is to sell your property, renting it out in the meantime will give you a steady source of passive income while you wait for it to be the right time to sell. This is especially true if you live in a neighborhood in transition. For many homeowners, the best call is to rent now and sell later.
3. Are You Ready to Be a Landlord?
Being a landlord isn't for everyone—so it's worth considering whether you see yourself in that role. It's a big job that can potentially be time-consuming as well as emotionally draining. Advertising and showing the home, maintaining the property, running background checks, and fielding calls from tenants isn't how everyone likes to spend their time.
Luckily, if you're not sure overseeing the daily grind of operating a rental property is for you, our Leesburg property management services are here to help. Our family-owned and operated company handles the big-picture and day-to-day management of your rental property, so you don't have to! Our services include:
- Marketing and advertising your property—including setting up showings
- Screening all potential tenants, including credit, background, and rental history checks
- Collection of rent and security deposits
- 24/7 on-call emergency service
- Tenant communication and handling of tenant disputes
- Providing and supervising all property maintenance and repairs to ensure swift upkeep
- Detailed property inspections—including inspections before and after your move-in and move-out day.
Are You Ready to Learn More?
Still wondering if selling or renting out your home is right for you? Start by reaching out to the experts in Leesburg property management services! We'll get you started with a research-driven analysis of your potential rental so that you can maximize the profitability of your property.
When you work with Gunn Property Services, you can sit back and enjoy the passive income of your rental property—without the day-to-day responsibilities of being a landlord!