by Sarah Velasquez of Our Perfect Abode
sarah@ourperfectabode.com

After you buy and remodel a fixer-upper, you're faced with a decision: rent or sell? Both options come with benefits and trade-offs in terms of time, convenience, and finances. Before you choose, it's helpful to consider the pros and cons of each path — Willow Window presents the following guide to help you decide.

Is It Best To Rent or Sell? Factors To Consider

Rental property provides long-term revenue, but it also comes with an investment of time and money. Selling the property may bring in a lower profit, but it's a relatively hands-off option. As you decide, ask: 

• What's a realistic sale price? Determine if the price is likely to bring a profit, and compare it to potential rental revenue. 

• How long are houses sitting on the market? You must pay utilities and the mortgage until it sells.

• How much can you charge for rent? Make sure that amount is enough to cover the mortgage, taxes, insurance, and repairs.

• Is there a demand for rentals? Higher demand means you can charge more in rent.

• Do you have the time and skills to be a landlord? Renting a property can be a big responsibility.

• How can you use the equity in a home? Rentals build equity, which you can use for loans and lines of credit.

Selling vs. Renting: Financial Considerations

For many people, finances play a big part in the decision to sell or rent. Renting requires you to have cash on hand — you need it to pay the mortgage and taxes until you find a tenant. If you've sunk a great deal of money into improvements and renovations, selling may be a better option.

Selling may also be a good idea if you need a lump sum of money for another purpose, such as buying a home. Renting brings in income but in smaller amounts and at a slower pace.

Are You Ready for the Responsibilities of a Landlord?

Before you list a home for rent, take a moment to decide if you're willing to take on the task of managing a rental property. As a landlord, you're responsible for keeping the home safe and comfortable for tenants according to state law. The job may include: 

• Screening potential renters

• Scheduling and paying for repairs

• Maintaining electricity, heating, and plumbing

• Managing trash collection

• Ensuring the property is up to code

• Handling pest control

• Handling neighbor complaints

• Collecting rent 

Outsourcing Tasks as a Landlord

If you have the skills and tools, you can handle repairs and upkeep tasks on your own. If not, ensure you have room in the budget to hire professionals. Services to consider include:

• Lawn-care service for mowing and leaf collection

• Handyperson for routine repairs

• Snow-removal service for plowing and shoveling

• Cleaners between tenants

For convenience, you may opt to hire a property management company. They handle the most time-consuming tasks for you: managing applications, vetting tenants, and processing rent payments. Some companies also take care of basic upkeep and repairs.

Making a Profit From a Fixer-Upper

Renting and selling offer the opportunity to make a profit from your remodeled fixer-upper; the route you choose depends on your time and financial priorities. No matter which option you choose, consider installing energy-efficient windows from Willow Window in Cookeville so you can save on utilities and maximize revenue.