Should You Sell or Rent Out Your Renovated Investment Home?
Published | Written by Jerry Newman
You’ve invested in a fixer-upper. You brought a property from being inhabitable to being one of the most attractive homes in the neighborhood, and now you don’t know what to do with it.
Should you sell the property for an immediate boost of income? Or, should you hang onto it and establish a steady flow of passive income?
The truth is many factors will determine which decision is right for you. You must evaluate your specific situation and figure out whether selling or renting will help you meet your long-term goals and vision. Below, Jerry Newman of Brown Realty and Property Management covers all the topics that will influence your decision.
Do You Want to Be a Landlord?
First of all, think about all the factors involved in being a landlord. Are you sure you are cut out for the job? Do you even want to be a landlord?
Rent Prep notes that you’re the boss and you have a lot of control when overseeing and managing a property. But with power comes responsibility. Better yet — responsibilities. It’s up to you to take care of all major repairs on the home and a lot of minor ones. If you’re short on cash at the moment, having to pay for labor and materials could put you in a bind.
Also, you have to make sure you can afford to maintain the property inside and out. Landscaping services, replacing appliances, and regular design updates can take a toll on your investment property budget.
If you plan to manage the property yourself, it will cost you a lot of time. In other words, being a landlord will cost you something no matter which path you take.
That said, you may benefit from hiring a property manager to relieve you of some of your burdens. If you can budget for it, find a reputable property management company in the area to handle repairs, maintenance, rent collection, tenant background checks, and other duties.
Have You Remodeled Enough?
If you choose to rent out your home, you must make sure it’s in tip-top shape and includes modern features that appeal to a wide range of tenants. You may have already taken this into account and fully renovated and remodeled the home. If that’s your situation, you’re halfway to running an investment property successfully.
If you still have a few changes to make before the property is ready to show, start researching
design ideas online and find local services that can get the job done on time.
For instance, you can easily find a local contracting company to install a fence around the property. Just be sure to read online reviews and interview a few different companies before hiring someone. It costs an average of $2,839 to put in a new fence according to Bob Vila, the total cost depending on the size and location of the fence, materials, and other factors.
Be Business-Minded With Marketing, Including Using Banners
Marketing is another responsibility that comes with being a landlord. Keep in mind that being a landlord essentially means that you’re a business owner, and you should treat your investment property venture as such.
Along with creating a killer listing for your own website, real estate sites, and rental platforms, create a brand that distinguishes your property from others. If you enjoy renting out this home, you might pursue other investment properties down the road. You’ll need a unique and attractive visual identity for your empire!
Look for DIY marketing tools to save money. Many technologies on the web can help you develop and execute a top-notch marketing strategy for your property. For instance, you can skip the professional design services and make a banner quickly with an online banner template. Many banner makers are easy to use; you just choose a premade template and customize it with the design elements you have in mind. Then you can use the graphic on everything from printed marketing materials to social media and your website.
When to Sell Your Newly Remodeled Home
You may already have an idea of whether or not you want to rent or sell your investment property. But let’s quickly touch on a few clear signs you should sell:
Now’s the Time to Sell
If it’s currently a seller’s market, then it’s an excellent time to sell your investment home. Essentially, this means housing inventory is low and buyer demand is high.
You’re Short on Cash
If you’re more concerned with short-term goals and would like more cash up front, selling your investment property is the only way to achieve it.
The Home Is Old
Old houses tend to bring about a wide range of problems, many for which you can’t prepare. The cost of repairs and maintenance can quickly add up, not to mention add considerable stress to your life.
You Can’t Charge Enough for Rent
Take time to research and analyze rental and vacancy rates in your area. If you’re not able to charge what you need for rent, you might be better off selling the property.
When to Rent Out Your Newly Remodeled Home
Now, here are some indications that renting out your newly remodeled home is the best strategy:
You’ve Always Wanted to Be a Landlord
You’ve wanted to be a landlord since you were a young child. You daydreamed about it in middle school and still think about the prospect daily. Or, you just think you’ve got what it takes and that being a landlord would be cool. Either way, you’re probably suited to rent out your property.
Rental Demand Is High
When rental demand is high, you can raise rental rates and be more selective with tenants. And you won’t have to stress out as much about vacancies.
The Home Has Great Amenities
If your investment property has multiple amenities that appeal to renters, it could spell success for your rental property. Short-term renters care more about swimming pool access, nearby activities and entertainment, and other features that vacationers would look for. Long-term tenants look for properties with good appliances, quality floors, close proximity to work and other daily activities, etc.
You Know You Can Make Money
You’ve been over the books and thoroughly analyzed your investment home. And you’ve concluded that you can absolutely make good money by renting it out. If you would like to earn passive monthly income, by all means, rent out that property!
The decision to sell or rent out your investment property requires you to consider many factors. But at the end of the day, it comes down to what you want to do and whether selling or renting gets you closer to your long-term financial and life goals.
Keep researching the market and finding other ways to position your investment property venture for success. And remember to connect with a top-rated real estate pro like Jerry Newman if you decide to list your San Antonio property for sale! Team up with Jerry today by calling (210) 789-4216.
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