Should I Rent Out My House or Sell It?
This question has probably ran across the minds of many homeowners, and probably much more now since this buyer’s market is forcing many buyer’s to make tougher decisions regarding their property. Every situation is different, some rent out their homes due to necessity, (Market is slow, need to move asap, etc), others rent due to investment related goals.
Benefits of renting your home:
Tax-breaks could offset income tax on rent.
Depending on the rental market pricing and your monthly mortgage amount, you potentially can cover your monthly mortgage payments and create cash flow.
You can allow your property to appreciate as the market returns.
With these benefits, come potential risks such as various tenant issues, which a property management company such as Prime Market Realty could help mitigate and manage.
Also take note of the 2-5 rule when it comes to capital gains, especially if you are expecting a large profit on a future sale of your home. You would have to have lived in your home for at least 2 out of the last 5 years prior to the sale of your home to get the tax-free incentive; however there are exclusions and exceptions to this rule. Looking further into this may alter your decision on renting out your home, or at least for only a certain amount of time.
Benefits of selling your home:
Freeing up equity that could be rolled into a new home or for investing
Possible tax-free capital gain
Not having to deal with another property
One of the cons of selling a home especially in this buyer’s market is the obvious potential loss in property appreciation when it does occur.
There are many additional reasons when considering either option. Only you can decide which one is best for you. But for additional answers to your questions, the team at Prime Market Realty can ensure that you get the direction and support to help you decide what is best for you.
Prime Market Realty
Office: 630 235-3848