Choosing to Rent Out Your Home When the Housing Market is Slow
If you can not seem to sell you house, or you do not want to sell it at the current market price you might consider renting it out. If you rent it out your home now, you can grow the equity in your home and then sell when the housing market improves for sellers.
"After a barely perceptible dip in April, foreclosure activity roared back with a vengeance in May," said James J. Saccacio, chief executive officer of RealtyTrac. "Such strong activity in the midst of the typical spring buying season could foreshadow even higher foreclosure levels later in the year. Certainly not every community nationwide is seeing an increase in foreclosures, but foreclosed properties are becoming more commonplace and adding to the downward pressure on home prices in many areas."
For those faced with the possibility of foreclosure renting out your home and
then renting a smaller unit for yourself maybe an option. If you mortgage is
$1000 and you can get $1400 in rent for your home then there is $400 you can
apply to a smaller home that costs $800 a month. This option may not work for
all individuals, but for some this might be a viable option. You also need to
remember that you need to set aside money each month for any unexpected maintenance
and/or property repairs.
Choosing to rent out your home requires knowing the different laws that exist
for renters and landlords in your area. You also need to calculate what you
will charge for rent. In calculating the rent you must consider your mortgage
payment, and have extra to offset any repair and maintenance that you would
have to make to the property.
If the process of looking for a renter and managing a rental property seems overwhelming, you may consider using a property management company. There are several property management companies available across the Tampa Bay area. Each company has specifics, but they all have a contract that you can sign for them to manage the property for you. They will take a certain percentage of the monthly rent. Some ask for a specific amount of money up-front and others ask for half of the first month's rent. Like anything else, it is about doing research and asking lots of questions.
