If You Can't Sell, Are You Thinking of Renting Out Your Geneva IL House?
Some homeowners in St. Charles, Geneva and Batavia IL are wondering if they should rent out a house that they can't sell in this market, especially if they have already moved and the home is sitting vacant. We have very little rental housing here in the Fox Valley, so there is certainly consumer demand for nice rentals. This post from Keeping Current Matters gives homeowners some very useful advice to consider before they renting their home.
I am a Geneva IL real estate agent who can help you analyze all the Geneva IL homes for sale to make sure that your home is prepared, staged and priced competitively to sell in this market.
Things to Consider Before Renting a Home You Can’t Sell?
by The KCM Crew on August 15, 2011
In this difficult housing market, more and more homeowners are considering renting their house instead of adjusting the price. We strongly believe that residential real estate is a great investment and therefore can understand this thinking. However, if you have no desire to actually become an educated investor in this sector, you may be headed for more trouble than you were looking for.
Before renting your home, you should take the following steps to make sure this is the right course of action for you and your family.
Set a consultation appointment with an eviction attorney
People rent out their homes assuming that every tenant will pay the rent every month. We must realize, because of the current economy, there are millions of people not paying their mortgage. There is a chance you may rent to someone who at some point can’t (or simply won’t) pay you the rent. Understand what the legal challenges of eviction could potentially be before deciding to rent your home
Interview property managers
If you are not a full-time investor, hire a professional to handle the property. You need someone to find a qualified tenant, collect the rent and manage the problems. You don’t want to have to make collection calls. What would you say if a tenant told you that they had enough money to either buy food for their children or pay you your rent but not both? You need a person experienced with these situations to help.
You also don’t want to receive calls at all hours of the day and night regarding maintenance issues or challenges a neighbor may be creating for your tenant.
Create an honest budget
Sure, you will receive revenue in the form of rent. However, don’t forget you will also have expenses. Some of the expenses you should consider:
- Mortgage Payment (unless there is no mortgage on the home you will rent out)
- Property Taxes
- Maintenance Expenses such as repairing or replacing: roof, heating/air conditioning unit, appliances, etc.
- Insurance – Check with your insurance company who may suggest or demand that you increase your liability coverage.
Bottom Line
Again, renting out residential real estate historically is a great investment. However, it is not without its challenges. Make sure you have decided that you want to rent the house because you want to be an investor, not because it looks like an easier way out than selling the house.
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