Every day, people find themselves with an extra house on their hands. It could be from an inheritance, a settlement, or simply a house or condo that you didn’t sell when you bought your new home. However you got it, you’ve got to deal with it. Your friends are probably telling you to hang on to it, you can make a killing if you turn it into an investment property. These friends may not have any investment properties of their own or understand the responsibilities involved in becoming a landlord.
Yes, the market nationally for rental homes is blistering hot, and rents have never been higher. Even if you own the home outright, it’s not free to keep owning it. You’ll have to pay taxes on it, and if it’s inherited you may find yourself owing back taxes. Even without a mortgage requiring homeowner’s insurance you need to have the structure insured–if a tree falls on it or lightning strikes you’re left with a hole in the roof or a burned out house, so a little policy to cover costs to repair is a really good idea. If your property has any HOA dues you’ve still got those to pay on a regular schedule.
Once you’ve worked out the budget for the cost to own, figure out your cost to rent. You heard that right–it will cost you to rent your house. You’ll need to spruce up the place–repair any damages to walls, floors, windows, whatever is less than shipshape. A fresh coat of neutral paint, new or refinished floors, and new appliances are necessary to attract the sort of tenant you want, and the landscaping should be freshened up.
If you’re still determined to be a landlord, you might need a property management company to deal with routine maintenance and repairs, or be prepared to be very handy and available 24/7. States have a variety of rules defining the landlord/tenant relationship, but failing to respond to maintenance requests in a timely manner is frowned upon in most states and you don’t want to go to court because you didn’t get the message the water heater burst.
There is an alternative to trying your hand at managing property–let Seller’s Advantage buy it. We can usually close a transaction in a couple of weeks, and you have the benefits of ready cash and keeping that landlord dream alive. If you think this is the solution for your extra house, contact us and learn more about our simple, no-pressure home buying process.