Should You Sell Your House or Rent It Out?
When you’re ready to move, figuring out what to do with your house is a big decision. And today, more homeowners are considering renting their home instead of selling it. Recent data from Zillow shows about two-thirds (66%) of sellers thought about renting their home before listing, with nearly a third (28%) taking that possibility seriously. Compared to 2021, when fewer than half (47%) of homeowners considered renting before selling, it’s clear this trend is on the rise. So, should you sell your house and use the money toward your next home or keep it as a rental to build long-term wealth? Let’s walk through some important questions to help you determine the right path for your financial and lifestyle goals. Is Your House a Good Fit for Renting? Before you decide what to do, it's important to think about if it would make a good rental in the first place. For instance, if you’re moving far away, managing ongoing maintenance could become a major hassle. Other factors to consider are if your neighborhood is ideal for rentals and if your house needs significant repairs before it’s ready for tenants. If any of these situations sound familiar, selling might be a more practical choice. Are You Ready for the Realities of Being a Landlord? Managing a rental property involves more than collecting monthly rent. It’s a commitment that can be time-consuming and challenging. For example, you may get maintenance calls at all hours of the day or discover damage that needs to be repaired before a new tenant moves in. There’s also the risk of tenants missing payments or breaking their lease, which can add unexpected stress and financial strain. As Redfin notes: “Landlords have to fix things like broken pipes, defunct HVAC systems, and structural damage, among other essential repairs. If you don't have a few thousand dollars on hand to take care of these repairs, you could end up in a bind.” Do You Understand the Costs? If you’re considering renting primarily for passive income, remember there are additional costs you should anticipate. As an article from Bankrate explains: Mortgage and Property Taxes: You still need to pay these expenses, even if the rent doesn’t cover all of it. Insurance: Landlord insurance typically costs about 25% more than regular home insurance, and it’s necessary to cover damages and injuries. Maintenance and Repairs: Plan to spend at least 1% of the home’s value annually, more if the house is older. Finding a Tenant: This involves advertising costs and potentially paying for background checks. Vacancies: If the property sits empty between tenants, you’ll lose rental income and have to cover the cost of the mortgage until you find a new tenant. Management and HOA Fees: A property manager can ease the burden, but typically charges about 10% of the rent. HOA fees are an additional cost too, if applicable. Bottom Line To sum it all up, selling or renting out your home is a personal decision. Let’s connect so you have a pro on your side to help you feel supported and informed as you make your decision.
The Home Inspection
When buying or selling a home, a home inspection is a crucial step that can make or break the deal. Whether you're a seller looking to ensure your property is in top shape, a buyer aiming to uncover any potential issues, or an investor seeking to make an informed decision, understanding what to expect during a home inspection is essential. Your Realtor can help you find a qualified company and will be on-site as the inspector performs his tasks. The Complete Home Inspection Depending on the size of the property, a complete home inspection can take anywhere from two to three or more hours. The inspector often starts on the outside of the home and takes a look at the following items: Roofs, Chimneys, Valleys, Siding, Trim, Windows, Gutters, Drainage, Downspouts, HVAC Systems, Landscaping, Grading, Driveways, Pools and Spas, Exterior Electrical Outlets, Walkways, Patios, Decks, and Porches. The interior inspection covers the Heating, Cooling, Plumbing, Electric Panel and Outlets, Branch wiring, Drain Lines, Water Supply Lines, Cabinets, Doors, Windows, Foundation, Framing, Appliances, Water Heater, Sinks, Toilets, Bathtubs, Showers, Attic and Insulation, Signs of Pest Infestations. The inspector will take notes and pictures of each item inspected and rate it according to a traffic light system. Green means it passed the inspection, yellow/orange means it needs attention, and red equals defective. Typically, the report is available within 24 hours of the inspection and sent to the customer. This detailed document gives valuable insight into the home's health and will become the basis for either further negotiations with the seller or termination of the contract. Other Types of Inspections Occurring During the Home Buying Process 1) Walk-and-Talk Inspection A walk-and-talk inspection is a shorter form of the complete inspection but still covers the most critical aspects of the property. Often, these kinds of inspections are scheduled before a potential buyer makes an offer on a home. While it is much shorter in duration and not as thorough as a complete inspection, it can give buyers and sellers peace of mind when moving forward with a transaction. 2) Wood Destroying Insect (WDI) Inspection Most lenders require home buyers to perform a Wood-Destroying Insect (WDI) inspection before the loan can be fully approved. A WDI, sometimes called a Termite Inspection, examines home spaces prone to insect infestations and is conducted by a certified termite inspector. In the Mid-Atlantic region, the inspector will mainly look for signs of termites, carpenter bees, carpenter ants, and powderpost beetles. Suppose a WDI inspection discovers damage caused by wood-destroying insects like termites. In that case, the inspector will document the extent of the damage on the inspection report, noting the location and severity, and typically recommend a professional pest control treatment to address the infestation and repair any structural damage; the property seller is usually responsible for taking action to remedy the issue, which may involve negotiations with the buyer depending on the severity of the damage. A home inspection is an indispensable part of any real estate transaction for sellers, buyers, and investors alike. By covering critical areas such as the foundation, attic, electrical systems, HVAC systems, and plumbing, an inspection provides valuable insights into the property's condition. This thorough examination ensures peace of mind for all parties involved by highlighting any issues that need addressing before finalizing the deal. Whether you're preparing to sell your home or looking to buy or invest in one, understanding what to expect during a home inspection can help you navigate this essential step with confidence.
Make Your Home Stand Out with Staging
In today's competitive real estate market, both buyers and sellers are looking for that special edge. For sellers, the most effective strategy to make your property stand out and attract serious buyers is home staging. It's no secret that staged homes sell for more and in fewer days than their non-staged counterparts. Sometimes, sellers might confuse staging with decorating. Decorating your home is about your personal style and preferences, but how you decorate it and market it for sale are very different. Staging your home means attracting the greatest possible buyer pool. At its best, a well-staged home doesn't just showcase the property; it creates an emotional bond with potential buyers. When a buyer steps into a meticulously staged home, they can easily visualize themselves living there. This emotional connection is crucial as it can be the deciding factor that turns a casual browsing session into a serious offer. Staged homes are also more visually appealing in listings. As buyers often start their search online, the first impression is made through photographs. Professional staging ensures that every room is presented in the best possible light, with optimal furniture arrangements and décor choices highlighting the home's strengths. This increased attractiveness can lead to more showings and, ultimately, more competition from interested parties. Moreover, statistics consistently show that staged homes spend less time on the market. According to the National Association of Realtors (NAR), staged homes sell 73% faster than non-staged homes. The shorter time on the market translates to fewer price reductions and lower carrying costs, benefiting sellers significantly. A survey of over 6,300 homes sold in 2022 showed that staged owner-occupied homes yielded an average return of $28 for each dollar spent on staging, while the return on investment for vacant staged homes was $14 per dollar spent. But the advantages of staging aren't one-sided. Buyers also benefit from viewing staged homes. For many buyers, envisioning the potential of a blank space can be challenging. Staging shows them the possibilities, helping eliminate doubts and providing a clearer sense of the property’s functionality and flow. In conclusion, home staging is an invaluable tool in the real estate arsenal. Whether you are a seller looking to maximize your profit and minimize your home’s time on the market or a buyer aiming to find a property that feels just right, staging has the power to transform the home buying and selling experience. Make your home stand out and reap the benefits of a well-staged property. source: RESA (Real Estate Staging Association)
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