Should I Sell My Home or Rent it Out?
One of the most common questions I get today is "Should I sell my home or rent it out?" The answer of course depends on your individual situation. Both selling your home and renting it out have their own advantages, as well as disadvantages.
Should I sell my home or rent it out?
Let's begin by dispelling some very common rumors.In today's real estate market, there are a lot of people wondering if it is a good ideal to sell their home. All they hear is the doom and gloom on the news and they are scared. Should I sell my home? What will it cost to sell my home? What is my home worth? Should I rent out my home?
Each real estate market is different, so don't listen to the national news. Don't even listen to the local news, because the housing market can vary from neighborhood to neighborhood. The only way to truly understand what your home is worth is to speak with a local real estate agent.
Should I sell my home?
Many people fear selling their home because the market has declined over the past few years. Depending on where you live, that decline may be significant. So why sell your home now? The best reason there is to sell now is to buy a more expensive house, or "move up." As an example, let's say your house 5 years ago was valued at $200,000. Let's say that you are looking to purchase a home that 5 years ago was worth $300,000. You have to remember that if your area's real estate market declined by 20% over the past few years, all of the homes took that hit, not just yours. The home you are going to sell is now only worth $160,000, while that $300,000 you want to buy now is only worth $240,000. While you lose $40,000 on the sale of your home, you are actually gaining $20,000 in market value.
What are the downsides of selling my home?
Obviously, the biggest downside is that you are going to lose money, but you will also have to change your lifestyle, keep your home ready in show condition at all times, deal with strangers calling up last minute to tour your home, real estate contracts, negotiating, and more. Selling your home can be a big headache. On top of all of that, if your home cannot sell for what you owe on it, you are either stuck in it, will have to pay money at the closing table, or will have to convince your lender to allow you to do a short sell on the property. Consider that a headache x100. Continued on the next page