If you’re planning to move out of your current home, figuring out what to do with the property isn’t always straightforward. On the one hand, you could list your home and hope you get a sizable offer for it, but on the other hand, you could rent out your house and make a predictable monthly income on the side.
Which option should you choose? That depends on several factors, including the current housing market, your financial situation, and your long-term financial goals. Read on to learn what you should consider when deciding whether to rent or sell your house.
Do You Really Want to Be a Landlord?
Being a landlord isn’t as easy as it might seem. You’ll have a responsibility to your future tenants to not only provide them with a habitable living space but also respond to their needs and any necessary repairs in a timely manner.
Keep in mind, too, that renting is always a risk. You never know what tenants might do to your property or even if they’ll pay their rent on time (or at all).
Before you decide to rent your house, take some time to really think about whether you’re ready to shoulder the responsibility of becoming a landlord and whether the monthly rental income is worth the hassle involved.
If you don’t want to manage the property yourself, you can always hire a property management company to handle everything for you, but that’ll cost you, as will the long-term, routine upkeep of the property.
Does Your House Need Work?
If your house needs any major repairs, such as roof, foundation, or HVAC repairs, you probably won’t be able to rent it out until you’ve taken care of those things. That’s because, as a Mississippi landlord, you must provide tenants with safe and habitable housing. If you knowingly fail to do that, your tenants are well within their rights to withhold rent or, in certain cases, pursue legal action against you.
If your property needs some serious work that you’re not willing to undertake, you’re better off selling it than renting it. But selling a damaged home on the open market can be tough. You can, however, sell your house fast to a cash home buyer even if it’s in poor shape.
Do You Need to Access Your Equity in the Home?
Are you planning to purchase another home? Would the equity that’s tied up in your current home allow you to make a larger down payment on a new house? Then selling your current house is likely in your best interest.
You can also use the proceeds from the sale to help with your moving expenses and offset realtor fees and closing costs. If your new house could use a few renovations, you’ll have some additional cash to put toward those expenses too.
Are Property Values Likely to Increase in the Area?
What does the real estate market look like in your area? Have property values been rising? Is there economic development going on that will eventually cause property values to spike? Then it may be in your best interest to hang onto the house, rent it out, and wait for its value to appreciate.
Will You Pay Capital Gains Tax If You Sell the House?
How long have you owned the house? More importantly, how long have you lived in it? Because if you’ve lived in your house for at least two of the last five years (those two years don’t have to be consecutive), you can avoid paying tax on your capital gains from the sale of your home.
If you’re single, you can qualify for a tax exclusion of up to $250,000 of your gains. If you’re married, and you and your spouse file jointly, that number jumps up to $500,000.
Are You Underwater on Your Mortgage?
Is the remaining balance on your mortgage more than the current market value of your house? Then you may not have enough equity in your property right now to be able to sell it without taking a loss. If that’s the case, renting out your house for a while will allow you to build up some equity, which will (hopefully) allow you to sell it for a profit in the future.
Moving Soon? Need to Sell Your House Fast?
If you’re planning a move in the near future and don’t want to rent out your home, get in touch with our team at We Buy Houses Jackson! We can help you sell your house fast — within days if you’re in a pinch — and we pay cash at closing. We buy houses of all types, no matter what kind of condition they’re in, and can make you a no-obligation offer in as little as 24 hours. To get started or learn more about how we work, feel free to call our Jackson, MS, office today (at the number on the top of the page) or request a cash offer online, and we’ll be in touch right away! We buy houses in any condition, so get in touch for a no-obligation cash offer.
