I Can’t Sell My Home, Should I Rent it Out?
Unfortunately with the continued downward pressure being applied to the Utah housing market, it is becoming more and more common that homeowners can’t afford to sell their current property. This can be especially frustrating if they have outgrown their home and would like to buy a bigger house, or if a job transfer has forced them to move out of the state.
If this sounds familiar, you might be asking yourself: what are my options? If you owe more than what the home is currently worth, you will either need to negotiate a short sale with the lender or come out of pocket for the difference between the sales price and what is owed on your mortgage in order to facilitate the sale. Many home owners may think that a short sale sounds like a good idea because you can just “give the property back to the bank”, but it has a negative impact to your credit and will prevent you from purchasing another home in the future.
If neither of these are options are for you, you may want to consider the possibility of renting your home. I know that the first thing that you may be thinking is “I don’t want to be a landlord and have to deal with the problems that renters bring”. While being a landlord can be a lot of work, it can also provide many benefits. By renting your home, it will allow you to not only continue to reduce the principal amount owed on your mortgage each month, but it will also provide you with time for the Utah housing market to turn around.
If renting out your home sounds like an option that may work, you must then decide if you will be managing the property yourself or if you will be hiring a property management company. While both options have benefits and drawbacks, you should decide based on your unique needs. If you have the time available to show the property to prospective tenants, complete the lease agreement, and handle all of the maintenance requests associated with the home, then managing the property yourself may be an excellent option.
On the other hand, if you do not think you will have the time required or just do not feel comfortable with all the responsibilities that being a landlord entails, then you may want to consider hiring a property management company. A good property management company will market your home for rent, screen all potential tenants, complete a lease agreement, collect rent payments each month, resolve all maintenance issues with the home, and evict the tenant if he/she does not honor the terms of the lease.
Renting your property can be an excellent alternative to selling in a down real estate market. If you have any questions about renting out your current home or if you are considering hiring a property management company, please contact us at FRE Property Management. We are the premier property management company in Utah and will provide you with the peace of mind knowing that your investment is being taken care of.