collection.
PROS AND CONS OF RENTING OUT
The most significant advantage of renting out your vacant home is gaining an additional source of income. This extra money each month will help you pay property taxes, mortgage, and utilities (unless you rent with the condition that tenants pay for utilities each month, which is entirely your choice). It is possible to return some profit. Another advantage is the increase in value of your vacant home through appreciation and/or by undertaking some renovations for your tenants, which could ultimately result in an enhanced investment at the time of sale. For example, finishing the basement and adding a kitchen and bathroom will transform it into a basement apartment, increasing the home’s value for resale. By renting out your vacant home, you can avoid potential issues such as squatters, vandals, and thieves. For example, if you own a vacant house and are rarely there, squatters and vandals will likely take notice. Therefore, it is best to rent it out, even for the short term, so someone is living there if you are not planning on quickly selling it. You may get lucky and even have tenants who can help with maintaining your property. This could be anything from lawn care to plumbing issues. A tenant could even become a future buyer for your property. One con to renting out is that you become the landlord, with the obligations, responsibilities, and headaches that come with that role. Property management is a dynamic activity, meaning you do not simply rent out your home and await income and tax benefits. There is regular and emergency maintenance (e.g., lawn mowing and the water heater that bursts at 3 AM). Bad tenants are a significant concern for property owners renting out houses. They cause property damage, are late on rent payments, or don’t pay rent at all. This will result in additional expenses for repairs, potentially involve legal fees for eviction
6
Powered by FlippingBook