Selling Vs. Renting From a Distance
With the explosion of the smart technology it’s easier than ever to manage a property from a distance. This makes renting a popular option for homeowners who find themselves moving away temporarily, and don’t want to sell their home.
But the idea of trusting others to make decisions on your behalf that greatly impact your financial future isn’t for everyone. This is why many owners who relocate—even temporarily—decide to sell their property and buy another one if they come back to the area later.
While we can’t make the decision for you, here are some factors to consider when deciding to rent or sell your current property.
Is Your Move Temporary?
Because the DC area is one of the priciest real estate markets in the country, you may want to hold onto your property, especially if you bought it more than a decade ago.
Because of the transient nature of DC’s economy, it will be easy to find a tenant looking for a short-term rental if you plan on being gone less than a year. If you sell your property now, you may find that you can’t afford a comparable home when you return.
Will Renting Your Home Cover Mortgage and Expenses?
Savvy financial minds will remind you that the rent you bring in has to be more than you pay out. In addition to mortgage, repairs, property management expenses and more have to be considered in order to break even.
If you haven’t owned your home very long, you may not be able to charge the rent you need to cover expenses. In this case, selling your home is the best option.
Tolerance For Stress
Even if you hire a professional property manager to help you with your rental property, the stress of being a landlord is not for everyone. If you can’t handle emergency repairs and late-night phone calls, put your property on the market right away!
Even with a great team in place, managing a property from a distance can be difficult. Though it is tax-deductible, travel back and forth can become expensive. You’re also likely to spend a lot of time communicating with your local team about various issues.
If you’re looking to build long-term wealth or are not sure how permanent your relocation will be, it makes sense to hold onto your property. Rents in DC are some of the highest in the nation and your potential for profit is high, if done properly.
However, being a landlord can be stressful and costly. If you are looking for short-term investments with high profits, renting your home may not be in your best interest. Selling would give you a large amount of cash to use to purchase a new property or invest elsewhere.
Being a landlord is hard work, but may be worth it in the long run. Instead of trying to manage a rental property from a distance, talk to a property manager. They’ll save you time, money, and headaches.
However, not everyone is landlord material. Sometimes selling really is the best option. Talk to a financial professional to help you come up with what works best for your situation.