If you’re a homeowner moving out of the Grand Rapids area, you will have to decide what to do with your home. In this market, selling can seem like the obvious solution. Inventory is far lower than demand and the market is competitive. However, there may be some good reasons not to sell your home right now.
There is another great option if you’re not quite ready to give up your asset. You can rent it out and earn some short term rental income while your tenants contribute to your mortgage and other expenses. Depending on your current financial situation and your plans for the future, this may be your best option.
Selling Delivers Cash and Equity
Selling can help you walk away from the property and all the responsibilities that come with it. You’re also likely to make some good money. The market in Grand Rapids is hot, and you can expect to earn what you want when you sell your home. Multiple offers may come in over the list price. If you need cash for a larger expense or to pay for the down payment of a new property, selling is the best thing you can do right now. The success of a home sale depends on a number of factors unique to you, of course. If your home is well-maintained and you have enough equity built up to make a profit, you can expect the sales market to deliver some great results.
Renting Out your Grand Rapids Home for Income and ROI
While you’ll have to give up the immediate sales proceeds, there are still many financial benefits to keeping your property and renting it out. You’ll likely earn a reliable rental income every month and your asset will continue to appreciate in value, delivering a larger payoff when you finally sell in a year or five years or 10 years.
The rental market in Grand Rapids is also moving in the right direction. There’s a high demand for well-maintained rental homes, and investors are finding a well-qualified and reliable pool of tenants. Rental prices are stable, and there are plenty of great renters willing to pay top dollar for a nice property. When you can attract and retain great tenants, they will help you pay off your mortgage while your property’s value continues to rise.
Tax Liabilities and Benefits with Selling and Renting
Don’t forget to factor taxes into this decision. There may be a capital gains tax on the sale of your home, whereas with rental property, you’re able to take a lot of deductions. You can deduct the home’s depreciation, which is pretty generous by IRS standards, and you can also deduct any expenses associated with the home, such as maintenance and professional services like accounting, legal fees, or property management. These write-offs help to reduce your overall tax liability.
Grand Rapids Property Management
If you have no experience as a landlord and you’re worried about your ability to find a tenant, collet rent, and maintain your home as a rental property, don’t worry. You can still rent out your home successfully.
Consider working with a professional Grand Rapids property management company. This makes sense for you when you decide to rent instead of sell, and it’s especially important if you’re moving out of the area and you can’t manage the home yourself.
Whether you decide that renting or selling is best, we can help. Contact us at Short South Management and Development.