Thursday, April 25, 2013

Home: Renting Out vs Selling

Your family has grown its number because you now have babies. You are doing well with your job and you feel that it’s about time to have a bigger home. One common question that you might have in mind is “Should I rent out my home?” or “Should I sell my home?” Before you decide which way to go, here’s what you should consider:

Do you want to be a landlord? Being a landlord is not easy. You should be available for your tenant if something goes wrong in the property – a pipe breaks, there’s a problem with electricity, kitchen needs repair, and so on. You should also be prepared in dealing with difficult tenants who will cause damages your property or are late in paying rents.

Can you afford to rent out? Since you are getting a bigger and a better place, ask yourself if you have enough to buy your next home. Maintaining two properties requires large amount of money in reserve. You should have a backup if your tenant did not pay the rent on time or if the property needs repair. Worst scenario is if you need eviction proceedings to move non-paying tenants. Eviction is a very tedious process not to mention very costly. As the landlord, you should be prepared for the worst.

You should consider the taxes when renting out your property versus selling. When you rent out your home you will still pay tax for your rental income but when you sell out your home you will not only earn money from your property, you could also earn money in capital gains tax-free. If you know of someone who will treat your home as their own, then by all means have your home rented. But if you think owning two properties is more of liabilities than an asset then sell your home quickly.

How to sell your home quickly? Sell it to private property investors like Lucas Properties LLC. They buy houses, apartments, and commercial properties in “as is” condition. In a matter of few days, you can walk away with cash for your home.

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