Should I Rent My House?

We have been very fortunate in renting our house in the suburbs of the Twin Cities. We currently have a couple and the husband is a contractor so he tends to make any minor repairs that need to be done. We rent it at a very favorable price because they are such good tenants. I suspect we could easily get 50% more. In Minnesota, we can go through Centerpoint and get a warranty that covers a number of the appliances in the house - essentially everything. I suggest finding something like that. That way if the A/C, furnace, refrigerator, dishwasher, etc. have a problem, our tenants can simply make the arrangements themselves to get it fixed. It saves us worry and hassle.

Good Luck!

 

What part of town are you in? My wife is a realtor and overall the market for selling is stronger than it is for renting. Her listings have been moving very quickly this year.

 

no joke. my friend's house sold at asking price the same day it was put on market.

 

I rent mine out, but handle everything myself. The #1 thing is getting a good tenant.

 

There are bidding wars going on for houses around here in the DFW area. I read a story of someone putting their house up for something like $399,000 and after a brief bidding war, it sold for $417,000. I was thinking about buying a new house and renting this one out, but then I don't want to deal with the potential hassle of renters.

 

The key is to find good renters. Property management firms can be tricky. They can be a bigger headache than the renters sometimes. There are pro's and con's to the whole dynamic. If you're a type of person who doesn't mind paying a little more for convince and less hassle, then I wouldn't recommend renting it out.

 

Yeah where is the house? My wife and I have been on the marker for a rental.

 

As others have posted, it seems the Houston market is pretty good for selling houses right now. We recently sold my mother's house in Inwood Forest (late January). We had a pretty good offer after the first day it was listed that fell through after a week or so, but then immediately had another offer and closed a couple of weeks later.

 

It difenitely has its pros and cons. It can really depend on your mortgage/taxes/insurance etc. If you would not break even each month, you might want to forget about it. If you can come ahead a few hundred each month, go for it.

If you don't want to manage it yourself, hire a property manager. They can lease, handle maintenance, and handle everyday tenant issues. They usually charge about a 10% of monthly rent fee and nominal leasing fee.

If you want to take charge of it yourself, educate yourself the most you can. Don't ever believe that a perfect stranger would be a good tenant. Screen them, keep a deposit, stay firm on the monthly due date. I handle my rent houses myself and it can be very stressful. At the same time kinda fun......

Also keep in mind that they take away your homestead exemption on rental property. Rental property insurance can be cheaper than regular home owners insurance. Do your homework and crunch the numbers before you make your decision!

 

I'm overseas for a year, so rather than selling my house (Heights/Timbergrove), I'm renting it out. Since I'm not around to manage it, I'm using Complete Property Mgmt. I picked them because they were one of the cheaper property mgmt companies available.

I'm renting out it for about $500 more than my mortgage, taxes and insurance.

Getting a good tenant is key. We received maybe 2-3 offers a week, and turned down quite a few before we picked. Settled on a single lady with a small dog. It's been good so far.

If you can manage it on your own, give it a shot, it will save you a couple hundred bucks a month.

 

I've been renting my pre-marriage house for about 6 years now after trying for 2 years to sell it (in the middle of the down cycle). I use a property manager. I don't have the time or energy to be a hands-on landlord. I can think of 1,000 other things I'd rather be doing than taking calls from bothersome tenants and I gladly pay a premium not to have to do that ever. My tenant has been in the house for 6 years and I've never even met the guy.

What part of town is your house in? I use Zing Property Management located on the northwest side. They charge 5% of rent every month and 1 months rent at the beginning of every lease. If it's a 2-year lease, then they still only charge 1 month's rent.

I don't escrow or pay PTI. If you add in taxes, insurance, and repairs, I usually break even every year. But I don't see that as 'breaking even' per se, because my tenant is basically giving me more equity in the house every month.

 

I've had at least 3 different couples literally ring my door bell asking if my house was for sale as they would love to bid on it. I was all , "Do you see a for sale sign?" A neighbor down the street put his home up for sale and in a week he had 5 bidders. He made close to 15% more due to the bidding and his home, and although beautiful, it's close to railroad tracks so they must have really loved it. Inner loop bidding wars are still there, but I'm seeing A LOT more newer homes up for sale now than I can remember.

 

It's a pain in the ass. But you make some money. And making money is a pain in the ass. So to me it's worth it. Grabbed something in EaDo to see what it might be worth a decade form now and it's going fine.

I think the Houston market is going to take a hit here pretty soon but it shouldn't last too long. So you might want to just focus on getting rid of it now if you're not committed long term.

Whether you hire a property management company or not - it's work. Short term - probably not worth the hours to you. Long term - probably is. If you're somehow hitting the 1% rule now then it's definitely worth the time now.

 

Rent it if you can't sell it. It worked for me and now I decided to buy another rental property.

 

Monthly rent at least 1% of what you paid for it(i.e.100,000 house rents out for $1000/month or more).