Moving On: Sell Your House or Put It Up For Rent?
When moving home, you’ll have to make the inevitable decision of whether to pack up your old place and sell it on or keep it as an asset and put it up to rent to generate a regular income. There are many factors to consider, both financial and practical, so here’s selection of the key points to think about when figuring out how to make the next step.
First take into account whether the home you’re moving out of still has a mortgage to pay or not. If it does then there are a couple of options. Renting it out could pay a considerable amount towards repayments or even cover them completely. However you will need to check with your mortgage lender first if you can rent as you may have to change to a buy-to-let mortgage which may be more expensive. So it’s worth researching if you can keep your home to rent and if all goes well, it can be a pretty sweet deal where the rental price can be charged high enough to cover the mortgage and provide a steady income.
Asses the Market
A crucial aspect to get some reliable advice on is the condition of the rental or buyers’ market whenever you decide to move. You can consult a couple of estate agents and websites on the matter to come up with your own assessment but if the rental market is strong in your area then it’s worth putting your house on rent because you’re more likely to find good tenants and a demand for the property.
When you sell your house you will let go of all responsibility for it after signing prescribed paper work and finding the highest price. On the other hand, a property on rent often comes with a surprising amount of responsibility. As a landlord you would be responsible for any repairs or maintenance as well as dealing with queries that the tenants have. You can either do this directly or give the property to an estate agent to manage but you will of course have to pay them a percentage fee for it.
It’s important to consider long term plans when handling such a large investment like a property. If you need a boost of income when moving into your new home, it might be worth selling the old one to give you that chunk of money as well as a fresh start. However if you’re unsure that your new home will be permanent and you might consider moving back into your old area, then it would be worth keeping the previous property in case you change your mind. In the long, long run, a property is a great retirement investment as you can rent-out a mortgage free property and receive a great passive monthly income.
There are plenty of options so it’s best to assess them and then figure out which one works best for you. Consult your friends and family as well as reliable websites and professionals for some sound advice too.