There are several things to consider when you’re deciding whether to sell your home or rent it out. Today, we’re discussing your options and how to choose the right path for your current situation and your future plans.
Renting vs. Selling a Home: Expenses
The first thing to consider is whether or not you’ll be able to collect enough rent money to pay for your mortgage and other expenses. If this is possible, I would encourage you to take this route. It’s a great way to get your mortgage paid off. Later in life, you can sell your home for one lump sum and have some extra retirement money, or you can supplement your income with rent. Or, you can accrue more than one investment property and live off your rental income.
If you cannot cover your costs with rent money, consider whether you can cover the deficit and whether the property value will increase over time. You’ll also need to decide whether it seems worth it to cover the cost for a few years.
Property Management Salt Lake City: Tax Benefits to Renting Out a Property
If you can rent out your property, it’s likely you won’t have to pay taxes on that rental income. There are several tax deductions to consider. For example, on a $300,000 home, you can usually deduct about $11,000 annually from depreciation alone. There are other expenses you can deduct at tax time, too, such as traveling to and from your investment property. The great thing about real estate is that it continues to appreciate, even as you get tax deductions for depreciation.
Rent or Buy a House: Relocation
Renting is great if you’re leaving the area for a period of time but not permanently. This often happens during work transfers. When people do this and come back home, a large portion of their mortgage is paid off.
If you do rent out your property, it’s important to find a good property management company. This will take away all the headaches of renting out your home. A property manager will can save you a lot of money as well as time and stress.