You have bought a property where you are currently living with your hard-earned money and it has everything you want in a house but then you need to shift. Maybe your work is forcing you to relocate or you want to stay closer to your family. Either way, you need to decide what to do with your existing house. As with most real estate questions, there is no right or wrong. As a home buyer, you need to understand the situation you are in and make the best choice out of it. In some cases, owning two houses can work and turn out to be a profitable decision if you decide to rent out the previous home. But, how do you get to know if that’s the right move? We have briefly discussed a few questions below that will help you understand whether you should sell your house or rent it out.
Will it yield any profit in the future?
There is no point in renting out your house if it isn’t going to give you profit. To know the same, understand the real estate investment math. Supposedly you rent out your house and after deducting the main expenses associated with renting the property that is taxes, utilities, mortgage, repairs, etc. will your house yield a monthly profit or a loss? If the bottle turns to loss, then consider selling. There are many real estate agents and house buying companies that deal in Spokane homes for sale. If you choose a house-buying company, you can sell your house against cash that can help you pay for the down payment for the next house.
What is the return on your investment?
Supposedly, you sell your property today; calculate how much you would make after deducting fees to the agent, closing the deal, and other sale expenses. If you make little or nothing, it would be a wise decision to hold on to the property and wait for the market to improve over time. Most of the time, property rates are heavily influenced by external factors like infrastructure, political turmoil, etc. So, analyze the market, and if you conclude that the property rates will improve shortly then hold on to the property. In this scenario, renting your house is an ideal situation as it will generate considerable cash flow in the meantime.
Analyze the market closely
Considering you will be making a loss on your property if you were to sell it today and that factor might be forcing you to reconsider your plan of selling the house, this is the time for you to take a step back and look at the situation from a third person’s perspective. Ask yourself this: what do the next ten, twenty years look like in your location? Are businesses moving into your area? Will things improve or the value of your neighborhood will decline? Certainly, you cannot answer these questions with 100% correctness but by analyzing the current trends in your market, you can make an informed decision. If the future in your current location looks bleak, consider selling now to avoid problems later on.
Are you willing to be a landlord?
Land lording is a skill that can be learned but most people aren’t cut out for this. Let’s be honest, some tenants are a dream to manage while others require extreme patience from your side. You know yourself better than anyone; if you are willing to learn, you will do just fine.
By renting the house, you can build wealth through cash flow, and selling the house at the right time will save you from future loss. Deciding whether to rent out your house or sell it is a decision only you can make after taking into account the aforementioned questions and ultimately making the choice that works best for you and your family. While you are deciding on the same, make sure you don’t neglect essential aspects of buying a new house that you should know beforehand.