There’s been a surge in rental demand since the pandemic, and it doesn’t look like it’s waning anytime soon.
As home prices have skyrocketed, it’s more difficult for buyers, especially first-time homebuyers, to purchase a property. Although rental prices have increased too, rentals are more affordable for buyers who don’t have the money for a down payment or don’t want the responsibility of owning a home.
If you own a property in DC, whether it’s a multi-family building or a single-family home, should you sell or rent it if you’re considering moving? With all the changes the real estate market has experienced, here’s when selling makes sense over renting and vice versa.
When Selling Your Property Makes Sense
Selling your DC property makes sense in certain situations. For example, if you have a single-family home and need the money to pay for a new property, you’ll likely need to consider selling. The same is true if you plan on buying another house and aren’t able to afford two mortgages, even when factoring in the potential rental income.
If you’re moving out of the area permanently or moving far enough away that maintaining an income property isn’t exactly convenient, you might want to consider selling. However, keep in mind that even if you live far away or don’t want the responsibility of managing an income property, you can always hire a local property management company.
You might also sell if your property needs significant updates before it can become a rental. Although taking on these renovations can deliver a better return on your investment with both renting and selling, it may not be a project you have the time, money, or energy to take on.
When to Consider Renting Out Your Property
If your property is paid off and you’d like extra monthly income, turning it into an income property can be an excellent investment. However, you can also rent out your property if you’re buying a new home and can afford both mortgages if your current home isn’t paid off.
Renting is also smart if you’re moving out of the area short-term, such as if you plan on traveling or moving to another place for a few months or years. If you plan to return to DC at some point and love your property, renting can help you make extra income and return to your home when it suits you.
You can also keep your property and use it as a rental if you want to sell your home in the future for more of a profit by waiting to see if the market continues to change or waiting for the next busy real estate season.
Renting can also be beneficial if you plan to stay in the DC area and can either manage the property yourself or outsource some or all of the tasks to a local property manager. And if your property is in a location where rentals are trending, it may be worth renting out your property for a premium price.
If you have a single-family home, consider that more renters are looking for single-family properties today than in the past, so your property may be more in demand than a multi-family apartment or condo building.
The Choice Is Yours
Wondering if you should rent or sell your DC property? If you’re curious about the rental market in your area, schedule a consultation with FAS Management to determine if renting out your home is worth it. Call us today at (202) 337-5080.
