Rent vs Sell: Should I Sell or Rent My South Florida Property?
Whether you’re a serial real estate investor or a resident willing to move to another home, one confusing question will always pop up in your mind, “Should I rent or sell my house?”. Both ways have pros and cons and can put the homeowner in a hectic situation. Renting vs selling a home has always been a popular debate among landlords and homeowners.
Renting will generate consistent money, and selling will provide you with an upfront amount. So, how to decide? Well, don’t worry, as we’re here to help. This article will guide you through all the perspectives of renting your home vs selling.
Should You Sell or Rent Your House?
Renting is often seen as a more reliable option as you hold the ownership of your home and generate a consistent well-grounded cash source. However, with renting, a lot of other variables come into play. It’s like playing a game, and even the most experienced real estate investors have carried a loss in this game.
For example, you need help finding the right tenants for your home to avoid losing much more money than you are generating. Or even worse, if your house sits empty for some time, it surely will be heavy on your expenses. Here is a list of expenses you’ll need to keep an account for when renting your property.
- Taxes
- Mortgage
- Insurance
- Repairs and Replacements
- Maintenance
- Accounting
- Vacancy
- Home Owners Association
Selling a House
However, on the other hand of the scale, selling a house also comes with its challenges and complexity. It’s a viable option if you’re looking for a way to quickly turn your property into cash. But you may face problems like paying unexpected real estate commissions or closing costs.
Selling your home may be beneficial for the short term. Still, you might want to reconsider if the associated expenses will eat into your profits.
While selling a house, you’ll also be dealing with home inspections, unpredictable market trends, and other problems. However, online real estate companies like 3 Step Home Buyer can help you get massive profits through the right guide and solid planning.
Financial Perspective
Let’s take a quick peek at the matter from a financial perspective. Selling your house will unfreeze your cash, and you can invest it in other things to create a reliable income source. Also, you can sell your house and use the amount to purchase your next home.
But, if you’re already sorted out for your next house and have spare time and money to deal with the rent issues, then renting is a better option. It’s known that Florida’s real estate is an always-growing market. Over the past decade, FL’s overall real estate value has risen 282.35%.
So, renting provides you with extra cash while the value of your investment keeps raising with time. If you play your cards right and efficiently deal with tenants, renting problems, and repair issues, renting your house is a sound investment financially.
What Should You Do?
Generally, we have looked at the problem, but what’s best for you? To answer the question, “Should I sell my house or rent it out?” let’s look at the things to observe when considering renting or selling property.
1. Rental or Property Demands
The first thing to consider is the property demands in your area. If you live in a luxury sector, its rental demand is expected to be much lower. However, rental demands can spike due to several factors like job booms, educational institution openings, construction startups, etc. Similarly, other situations can decrease rental demands.
For example, there was a major decrease in rental demands worldwide due to COVID. So, analyze the market situation in your area and decide what’s best for your property.
2. Property’s Condition and Value
The second thing to evaluate in this case is your property’s condition, repair costs, and market value. If a large sum of money is required to prepare the house for rent, then it’s best to sell it and look for better options. However, if your property is located in an elite area and you’re getting an excellent rental rate, then repairing and renting might be viable.
Gross Rent Multiplier (GRM) is the name of the game. It is the ratio of the price of the real estate to its rental income after subtracting the expenses. For example, you can rent out a low-value property for a good GRM (let’s say 1%). But as the property value increases, GRM will decrease, resulting in lesser profits.
3. Sentimental Value
If you’re not a real estate investor, you must have sentimental value for your house. A home is every man’s biggest dream. So, renting is the best option if you do not need cash and have sentimental value for your home.
You can keep your beloved home and generate monthly income while you’re not living there.
4. Instant Cash vs Long-term Income
Whichever variables you may consider, the final debate of renting vs selling home comes down to one topic, cash flow. If you don’t need instant cash for purchasing the next house or other ventures, then renting the house is best.
Renting will create a long-term income stream for you and also multiply your cash. So, instead of keeping your money static in the bank, your investment will actually increase in value while giving off monthly profits.
Choose 3 Step Home Buyer to Sell Your Home
No matter what your decision is, 3 Step Home Buyer is the top-notch solution for all of your real estate problems. With a decade of premium real estate market experience, we help our customers navigate the marketplace. We sell your home in three easy steps.
- Tell us about your home.
- Receive an offer.
- Close your deal.
Book a session with 3 Step Home Buyer and sell your home with great margins and minimum worries.
