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Should You Rent Your House or Sell It?

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Real Estate Agent with Luxury Valley Homes Scottsdale SA524104000

Should You Rent Your House or Sell It?

Should You Rent Your House or Sell It? | MyKCM

If you’re a homeowner ready to make a move, you may be thinking about using your current house as a short-term rental property instead of selling it. A short-term rental (STR) is typically offered as an alternative to a hotel, and they’re an investment that’s gained popularity in recent years. According to a Harris Poll survey, 28% of homeowners have considered using a rental service to temporarily rent out their homes for additional income.

Owning a short-term rental can be a tempting idea, but you may find the reality of being responsible for one difficult to take on. Here are some of the challenges you could face if you rent out your house instead of selling it.

A Short-Term Rental Comes with Responsibilities

Successfully owning and renting a house takes work. Think through your ability to make that commitment, especially if you plan to use a platform that advertises your rental listing. Most of them have specific requirements hosts have to meet, and it takes a lot of work. A recent article from Bankrate explains:

Managing a rental property can be time-consuming and challenging. Are you handy and able to make some repairs yourself? If not, do you have a network of affordable contractors you can reach out to in a pinch? Consider whether you want to take on the added responsibility of being a landlord, which means screening tenants and fielding issues, among other responsibilities, or paying for a third party to take care of things instead.”

Not only is there the upfront time and cost of owning a short-term rental, but there are also risks that could come up for you down the road. Investopedia warns:

“Risks of hosting include renting your place to rude guests, theft or damaged property, complaints from neighbors, and potential regulatory violations depending on your location.”

There’s a lot to consider before taking the leap and converting your house into a short-term rental. If you aren’t ready for the work it takes, it could be wiser to sell instead.

Your House May Not Be Ideal for Your Rental Goals

Not every house ends up being a profitable short-term rental either. One of the biggest factors is where your home is located. The less likely your neighborhood is to be a travel destination, the fewer requests you should expect from potential renters—and that impacts your bottom line. An article from the National Association of Realtors (NAR) advises:

“When it comes to the viability of profitable STRs . . . consider factors like location, amenities, and whether the property is appealing. Most people seek STRs in locations where they vacation, so proximity to attractions is important. Likewise, the property should cater to a variety of travelers.”

It’s smart to do your homework and learn how much rentals in your area go for, how much business they get throughout the year, and how this compares to your goals.

Bottom Line

Converting your home into a short-term rental isn’t a decision you should make without doing your research. To decide if selling your house is a better alternative, let’s connect today.

Comments(5)

George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Jane & Jeff Daley, PhD I have never had a desire to be a landlord, so the choice would be easy for me.

Feb 01, 2023 06:23 PM
Richard Weeks
Dallas, TX
REALTOR®, Broker

Great information, thanks for sharing.  I hope you have a great day.

Feb 02, 2023 02:00 AM
Kimo Jarrett
Cyber Properties - Huntington Beach, CA
Pro Lifestyle Solutions

Renting real estate builds wealth, yet, knowing how to leverage your assets to build wealth can be complicated. So, your advice to seek professional help  is essential, from an experienced real estate professional who can guide you to selecting your team of advisors. 

Feb 02, 2023 10:22 PM
Jan Green - Scottsdale, AZ
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Very smart post and great information for anyone seeking to turn their home into a short term rental.  STR's may come with extra taxes, insurance, and rules that are prohibitive.  As more of these pop ups and complaints are lodged, restrictions increase.  GREAT POST!

Feb 03, 2023 08:59 AM
Diana Dahlberg
1 Month Realty - Pleasant Prairie, WI
Real Estate in Kenosha, WI since 1994 262-308-3563

Great information for anyone thinking of renting out their home.  Thank you for sharing!  Have a great week!

Feb 06, 2023 08:36 AM