Should I Rent or Sell My House?

When you own a home you no longer want to live in, deciding whether to sell it or rent it out can be challenging. On the one hand, if you rent out the house, you’ll have an investment property that has the potential to yield residual income for as long as you hang on to the home. But on the other hand, selling your house could net you a decent return, and you can use that money for other investments or expenses.

How do you decide whether renting or selling your house is the best option in your current situation? Read on for a few important factors you’ll want to consider.

How Much Equity Do You Have?

If you’ve owned your home for a while, or you’ve worked diligently over a few years to pay down a good chunk of your mortgage, you likely have considerable equity in the home. Would accessing that equity help you purchase a new home or pay for moving expenses? If so, selling your house is probably in your best interest since more of the money you bring in from the sale will be profit. You can then put those proceeds toward a down payment or other move-related costs.

If you don’t have a lot of equity built up in your home, renting it out may be the better option. That way, you can put the rent checks toward your mortgage so you can build additional equity over a longer period of time.

Will You Owe Capital Gains Tax?

If you’ve made the house your primary residence for at least two of the last five years — and you stand to make a solid profit from the sale — selling your home may be your best option. Why? Because you can exclude up to $250,000 of your capital gains from the sale when you file your income taxes. If you’re married and file jointly, you can exclude up to $500,000 of your capital gains on the sale.

Haven’t lived in your house for at least two out of the last five years? Then you’ll owe taxes on your capital gains, so renting out the home may be a better option.

Will Renting Yield a Profit?

If you rent the home, will you actually make rental income? Or will you likely end up renting at a negative cash flow? If you’ll make a decent monthly profit from having tenants in the home, renting may be a good option, especially if the value of the home is projected to increase over time.

If, however, you’ll be renting at a monthly loss, it’s likely in your best interest to sell your house fast and move on. Why not use the money from the sale to invest in something that yields a better return?

Do You Really Want to Be a Landlord?

Have you ever been a landlord before? Do you want to deal with tenants? Do you know the ins and outs of landlord-tenant law in Nebraska? Being a landlord is a lot of work and hassle, so if you’ve never done it before, do your research before you take the plunge.

You’ll have to respond to tenant requests in a timely manner, pay for home repairs and maintenance, and ensure the house is always a fully habitable dwelling space. And, no matter how well you vet your tenants, there’s always a risk you’ll end up with problem renters. You can, of course, hire a property management service to handle the hassle for you, but keep in mind that can be expensive too.

What Does the Real Estate Market Look Like?

Are houses flying off the market as soon as they’re listed? Then it may be in your best interest to get in on the action so you can sell your house fast. If, on the other hand, the market is slowing down, or it’s been slow for a while, it’s better to rent out your house for a short period while you wait for the market to heat up again. That’s especially true if your home is likely to increase in value over the next few years. Rent the property until it’s worth more and sell it in the future for a more handsome profit. 

Does Your Home Need Major Repairs?

If your home requires considerable work, such as a roof replacement, HVAC repairs, or any other major repairs, it’s probably not rentable since the damages may put tenants’ safety at risk. And if you don’t want to pay to have the work done, you may not be able to sell the house on the open market either. What should you do then?

Sell your house to a cash home buyer. A cash buyer (like our team at Beard Bros) can purchase your house no matter what kind of condition it’s currently in, and you’ll get an up-front cash payment at closing. If you don’t want to deal with the hassle or expense of renting or listing your house on the open market, selling to a cash home buyer is likely your best option. We buy houses fast for cash, and make the process as easy as possible.

We Buy Houses in Omaha and the Surrounding Areas!

Are you ready to sell your Omaha home? Let our team at Beard Bros Buy Houses help you seal the deal! We buy houses in any condition, and we’re always on the lookout for properties in the Omaha area. Give us a call today or fill out our contact form to learn how we can help you sell your house fast for cash.