When you’re moving out of your home in San Diego, whether it’s because you’re relocating or because you need something different at this stage of your life, there are options for what you can do with that property. If you’re not sure that you want to sell it, you can rent it out to tenants. There are a number of benefits and challenges associated with renting and selling, and the best choice for you will depend on finances and long term plans.
Renting Out Your Property
The best argument for renting out your home instead of selling it is that you still have an asset that will appreciate over time. If you hold onto it for five or 10 years, you have a better chance of earning a higher return. Another benefit is the tax breaks that are associated with rental property. Your rental income will be taxable, but you can write off all the expenses that come with maintaining a rental home. It’s a great idea to rent your home out if you are able to collect enough rental income to cover your mortgage payment, including the property taxes and insurance.
What you need to consider as the challenges to renting out your property is that there’s always the risk of damage occurring to the home. Someone else will be living there and while you can collect deposits and keep a close watch over it, there’s still the danger that something will go wrong. There can also be financial worries. If a tenant is suddenly unable to pay rent or you have to evict people who have caused financial problems for you, it can be an expensive hassle.
Selling Your Property
If you need money right away, selling your home can give you an immediate profit. You can use that money to buy a new property or you can invest it in other opportunities. It can also be an easier solution for you. You’ll get rid of the home and you won’t have to worry about how it’s performing as a rental or whether you’ll be able to keep it occupied with good tenants.
The problem with selling the property is that you might find that prices are rising again in San Diego, and it’s hard to buy right now. You’re also losing any appreciation on this asset. The market is really bouncing back and when you sell your property, you lose any potential for making money off that investment. Even with the market performing well, you might not get the price you want for your home right now. Holding onto it might make better financial sense.
Contact Cassidy & Associates if you need help deciding whether it makes sense to sell or rent your home in San Diego.