We have been in real estate for many (near 40 combined) years, and for all that time we have handled both rentals (I use the terms renting or leasing interchangeably) and sales. We know both markets, and we know the "ins and outs" of both renting and selling. In today's real estate market many Owners are finding that they either can't sell, or might have to sell at a deep discount. Many are, therefore, turning to renting as a possible alternative to a bargain basement sale.
The following are things to consider when making this decision:
-Can I AFFORD to rent my house for enough time for the market to recover?
-At least in our area (Payson, AZ) the market is not likely to turn around for at least a year, maybe longer
-Possible rent may OR MAY NOT be enough to cover your mortgage payment
-a reputable Property Management Co. is not going to give a refundable security deposit to you,
so don't count on that money. It will probably go into the Co.'s trust account.
-Do your homework and find out how long it takes comparable properties to rent, and for how much $.
-Can you make the payment if the house doesn't rent for a few months, or if the Tenant leaves and the
property takes awhile to re-rent?
-Can you make any necessary repairs to make the place safe for renters?
-Can you do any fix-ups needed to make it "rentable"?
-Can you do necessary maintenance while the property is rented? What if the water heater goes out?
The furnace or AC? What if there is a plumbing or roof leak? Can you repair/replace necessary items?
-How "rentable" is my house?
-How much competition is there in your area for quailified Tenants? (Believe me, NO Tenant at all is
much better than the unqualified kind)
-How easy it it to rent properties in my neighborhood? Ask a good Property Manager.
-Is the rent amount I want/need reasonable? Again- ask a professional.
-Am I willing to allow pets? (people LOVE their pets, no pets makes a place less rentable)
-If you want to leave your house on the sales market Tenants will NOT want to rent it. You
will probably have to give them lower rent or other concessions to get it rented. And the Tenant
CAN and may "blow the sale" with any prospective Buyer.
-How ready am I to give my house up to Tenants?
-How emotionally attached are you? I guarantee you will have at least normal wear and tear.
-That "accent" wall you love may make the house harder to rent.
-Are you willing to allow children? Fair Housing violations are VERY expensive.
-Once the property is leased you CANNOT come on the property except with proper notice.
-You MUST comply with any and all national, state, and local laws regarding rentals.
This is not intended to be a comprehensive list of things to consider. It is intended to get you thinking. A good (read "experienced") Property Management Company can give you information particular to your area. If you decide to rent out your house we STRONGLY recommend letting a professional handle it. Mistakes (letting in a Tenant who can't pay, tears up the house, makes a meth lab, fills it with illegals, etc.) can be very expensive.
Renting CAN be a viable option- don't let this scare you off. Just be aware of the possibilities and
TALK TO A PROFESSIONAL!
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