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"I THINK WE ARE GOING TO RENT OUT OUR HOME"

"I think we are going to rent our home for a year," said my prospect about 5 minutes ago.

"Really, why are you going to do that?" I asked.

"Because we won't be able to get full value with the market today," he responded.

Hmmm. Very interesting.

Full value?? I always thought full value for your home is what someone is willing to pay for it TODAY.

Isn't it?

Not yesterday, or last year, or three years ago. Today.

This is a topic that I have wanted to write about for some time. Renting vs. Selling.

For those homeowners out there considering renting instead of selling, are you sure you know what you are getting yourselves into?

I talk with lots of people. Lots and lots of people. I know lots of unhappy landlords right now.

If you are considering renting over selling because of the real estate market, you are making a mistake.

If you really want to be a landlord, thats one thing. But if you are doing it just because you are scared of the market, think again.

Who started this "landlord phenomena"?? It sure wasn't me.

When a client calls me to sell there home, that's what I do.

I sell there home.

But I have noticed a disturbing trend. Many homes that were for sale get pulled from the market and are occupied by renters.

Is this because realtors have over promised and under delivered?

Being a landlord is more than just sitting back and collecting rent checks. You have responsibilites to your tenants.

You have to fix things.

Clogged toilet? You better have a good plunger.

Flooding basement? You better know a good foundation company.

If your tenant is late or misses a rent payment, the eviction process is no fun for anyone.

So don't be so quick to "rent" out your home waiting for the market to recover.

Find a realtor that will market your home and get it sold.

Move on with your life. You will be happier in the long run.

Ken

www.kensfeaturedhomes.com

Posted by Ken Tracy, RE/MAX - Naperville Illinois Real Estate on 05/09/2008 11:21 AM

Comments (8)

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8 Comments on "I THINK WE ARE GOING TO RENT OUT OUR HOME"

Ken, Very good information. I sure hope a lot of people considering renting see this article before they make their decision.

05/09/2008 11:33 AM

by Jimmy McCall~Clarksville's Mortgage Consultant (Legacy Mortgage Services, Inc. ~ Clarksville, Tennessee)

The flip side of this is alot of people can't afford to sell when they bought in 2005 and the value has come down, meaning they would have to come to the table with a check to sell their home.

For those, renting is sometimes the only viable option when they are moving. I have several that putting a tenant in for a couple years till the market reshifts is the best bet for them now.

05/09/2008 11:38 AM

by Desiree Daniels, Mercer County, NJ, Real Estate (RE/MAX Tri County)

You are SO right!

I have similar clients. They have insisted on overpricing thier home, not doing repairs or clean up and now after 13 mos. on the market are trying to rent it for top dollar and still keep it on the market.

Not only have I advised them not to rent, but that no one will rent a home they have to keep clean enough to show, just so they can be moved out when it does (if ever) sell.

In addition, someone who has not enough time to take care of the house when they live in it, certainly does not have time to take care of it after they move out and now have 2 houses to maintain.

But, you can't tell some people -- they just have to experience it. I just wish it was without me.

05/09/2008 11:41 AM

by Barbara Morales (Canyonsiderealty.com)

Hi Barbara, Desiree, and Jimmy. Thanks for stopping by.

I thought someone needed to stand up for the benefits of selling!

Ken

05/09/2008 12:20 PM

by Ken Tracy, RE/MAX - Naperville Illinois Real Estate (RE/MAX Action)

Ken- It's true being a landlord can be a stressful job. One of the other things is that you as the landlord will still be responsible for the repairs to a home while it is being rented out. Nobody takes as good of care of your things as you do. The cost of repairs should be factored into the expected increase in sales price in the future. Often things still do not pencil.

Best,

Scott

05/09/2008 12:29 PM

by Scott Cowan -Tacoma & Pierce County Area (Rainier Real Estate, Inc.)

Best,

Scott

05/09/2008 12:29 PM

by Scott Cowan -Tacoma & Pierce County Area (Rainier Real Estate, Inc.)

Ken these are great points- I think there are people who are cut out to be a landlord and those that are not. Renting to wait out the market???......not a great idea. I see too many people that try the landlord thing and then find they are not cut out for it and end up with more problems. If you want to sell... sell if you want to be a landlord- do some research, talk to others who have rental properties and go into it with a landlord mindset.

05/10/2008 06:36 AM

by Barbara Carter (Exit Realty Services)

Hi Scott and Barbara. Thanks for stopping by. Being a landlord is a responsibility.

Ken

05/10/2008 07:37 AM

by Ken Tracy, RE/MAX - Naperville Illinois Real Estate (RE/MAX Action)

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