When the time comes to relocate, or purchase a larger home, two options exist: Sell your current home, or rent it out. There are many factors to consider before making a final decision, and this discussion is a common topic during my initial consultations! Here are several factors to consider when trying to make the decision.
- Location factors in in many ways- if you are in a location that doesn’t have a typically high resale value, it may not be a bad idea to rent- however you must pay attention to city code to ensure that any changes that come along with having someone rent, are not going to adversely effect your plans. Locations with strong resale values are great candidates for resale, and listing your home for sale would be the ideal option. It is also important to consider the proximity to your new home, as you will have to visit or arrange a third party to maintain any issues that may arise.
- Financing and loan options are effected in circumstances of rent and second mortgages- It may be difficult to obtain a second mortgage in order to purchase a new home, and your original mortgage may have stipulations regarding owner-occupancy versus tenant occupancy. Timing also plays a factor as if you are looking to sell and haven’t owned the home long, you may be penalized by your mortgage company for doing so. It is important to research all aspects when making the decision! In addition, your homeowners insurance policies would need to change as well.
- Taxes and Fees definitely play a role in the decision to sell or rent your home- Many don’t factor in condo or home association fees when considering a rent amount to charge, and taxes will need to be covered as well. It is important to consider all of the financial numbers before making the final decision. Keep in mind as well that certain utilities, such as water, remain the property owners’ responsibility.
- Amenities typically included in a rental can be appliances as well as furniture in many situations. If your new home doesn’t have appliances, a second set may need to be purchased for either the home you will rent out, or your new home.
- Maintenance is a key factor when deciding to sell or rent out your home- as mentioned, proximity plays a role as you will have to be available for maintenance issues that arise- as well as regular maintenance, such as landscaping, in many situations. The costs for time and supplies would need to be factored in to your end decision as well.
This glimpse into all of the items that encompass the decision to rent your home should be evaluated and then consulted with a trusted REALTOR. Once knowing that potential resale value of your home, your decision may be to sell!