If you’re trying to decide whether it’s better to sell or rent your Redwood City property, the indecision is understandable. There are benefits and risks to each scenario. We work with owners who are moving out of state for work or personal reasons, or they’re buying a new home that better fits their lifestyle, and they’re not sure what to do with the property they’re leaving.
To put it simply, selling might be best for you if you need cash right away and you know you have no interest in holding onto the asset. But, if you don’t need instant access to cash and you’d rather earn some impressive returns in the long term, renting might be your best idea.
Ultimately, it will depend on your goals and financial situation. Today, we want to offer some tips on how to decide whether you should rent or sell your home.
Do you Need to Access Equity?
When the sales market is strong and home prices are in your favor, selling can be an excellent way to earn money and walk away from the property. Maybe you need the money you’ll make on a sale to send a child to college or put a down payment on a new home. There might be other investment opportunities you’d like to explore with that extra cash.
Whatever your reasons for needing a predictable sum of money, selling your property can deliver that. If you have enough equity in the home and you know the sales market will deliver the price you want, selling is an easy way to move on.
Can you Earn Attractive Rental Income and ROI?
There are many financial benefits to renting out your property.
You’ll earn a reliable rental income every month and your asset will continue to appreciate in value, delivering a larger payoff when you finally sell in a year or five years or 10 years.
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rental market is complicated and always shifting in Redwood City and the surrounding areas. California is unique in its statewide rent control strict eviction laws. But, there’s a high demand for well-maintained homes, and a well-qualified and reliable pool of tenants. Rental prices are high and stable, even with rent control laws, and there are plenty of great renters willing to pay for a nice property. When you can attract and retain great tenants, they will help you pay off your mortgage while your property’s value continues to rise.
Have You Thought About Your Taxes?
There may be a capital gains tax on the sale of your home, whereas with rental property, you’re able to take a lot of deductions. You can deduct the home’s depreciation, which is pretty generous by IRS standards, and you can also deduct any expenses associated with the home, such as maintenance and professional services like accounting, legal fees, or property management. These write-offs help to reduce your overall tax liability.
Renting with Professional Redwood City Property Management
