Should I Sell My Home In Newport Coast or Rent It Out?

Should I Sell My Home in Newport Coast or Rent It Out?

I have a home in Newport Coast and I can't decide if I should just sell it or rent it out. Help!

For many homeowners, renting out a home is simply not a viable option: they need to sell in order to raise the capital necessary to buy their next home. And owning two homes requires cash reserves. Consider, for example, that there may be periods in which you have no renter or when a tenant may skip one or two months rent. The mortgage payments still have to be paid.

Becoming a landlord is not for the faint of heart. What happens if the roof leaks and you’re away on vacation? There’s always the risk that a tenant could damage your property or cause problems that lead to an eviction.

On the other hand there are also excellent reasons to rent your property. Becoming a landlord offers some handsome tax perks. You can deduct pretty much any out-of-pocket expenses related to owning and managing the property. Then there’s the “phantom deduction” called depreciation wherein you can deduct the value of the property over 27.5 years. Be sure to speak with a CPA for more detailed information.

PROS and CONS of Selling vs Renting

Pros to Renting Out Your Home

1. You keep the property as it appreciates
2. Tax-breaks could offset income tax on rent
3. Rent income covers mortgage, taxes and insurance payments 

Pros to Selling Your Home

1. Likely a tax-free gain (see your CPA)
2. Free up equity that could be invested or used to buy a new home
3. Simplicity: Only one house to maintain.

Cons to Renting Out Your Home

1. Possible damages to your property
2. Could be taxed on the whole profit if you sell
3. Potential legal or financial problems with tenants 

Cons to Selling Your Home

1. Could be priced out of the market if you want to return
2. Lose potential property appreciation
3. Could have to sell at a bad time for real estate market in your area.

Need help selling your home in Newport Coast? I can provide you with the most extensive and comprehensive marketing plan available designed to obtain the highest price possible, in the least amount of time, with the least inconvenience to you!

Please contact Brian Jones at 949-422-1636 or email me at brianjones@firstteam.com

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