Megan Hannah is a Portland-based realtor and real estate photographer who helps clients navigate the process and find creative solutions to their individual and complex real estate problems. Reach out today for more info! 541-270-7479
We have all seen the shows that brag about how much money you can make by selling your home after you make renovations. But, is that your best option? Maybe not. The decision to flip your home or turn it into a long-term investment isn’t always easy to make. Realtor Megan Hannah outlines a few things to consider as you weigh your options.
Your Community
Most people believe that owning a home is a way to build generational wealth. In many cases, selling may help you get the most money, which you can then put down on another property and complete the process all over again. Before you make this decision, talk to a local real estate agent to see what similar homes are selling for.
In some areas, typically larger cities, it might make sense to rent your property. People often move to these locations for a job or promotion, and they don’t always have time to get through the buying process before needing a place to stay. Renting your property for a few years might help you recover the money that you put into it so that you can continue to save for the future.
Your Commitment Level
Obviously, you’ve already committed sprucing up a home. If you don’t want to be involved anymore, selling is the way to go. However, if you don’t mind taking on additional responsibilities, such as understanding rental real estate laws and learning how to do common home maintenance tasks, then becoming a landlord might be a great fit for you. According to Nationwide, you’ll be responsible for choosing the right tenants, keeping records, and collecting payments. You’ll also have to set a competitive rental fee and get landlord insurance to help cover losses if one of your tenants damages the property.
While you will have a much greater responsibility as a landlord than a seller, you don’t have to do it alone. A real estate pro may have advice that can help you rent your property for more money, and they can guide you in the direction of another home that might make a great temporary abode. You might also consider hiring a property manager, which real estate investment firm Stessa asserts will cost you approximately 10% of your monthly rental in fees each month.
Top Reasons To Sell
There are many reasons that you might consider selling, including:
Access to equity
Desire to move from your current city
You need cash for a down payment on another property
You don’t want to deal with strangers
One of the main reasons to not sell is if you have poor credit and cannot qualify for a rental or a home loan should you have to move.
Top Reasons To Rent
There are also benefits to becoming a landlord. Among these:
Monthly cash flow
Potential tax advantages
Increasing equity
Building your real estate holdings
A good reason to stick with selling is if you are not willing to put your tenants’ needs above your own. There might be times when you’re woken at midnight to come to fix a clogged toilet, and it’s your job to make sure it gets done.
The decision to buy a new home and sell the one you just made your own is not always easy. On one hand, you worked hard and you want your equity in cash. On the other, you have the potential to start a real estate portfolio that can help you build wealth and establish a passive income. So, how do you decide? Call Megan Hannah today to go over your options with a pro! Whatever you choose, good luck in your endeavors, and, remember, you can always sell later if you want to try your hand at running a rental business.
Image via Pexels
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