Should I sell or rent out my property?

rent-property

No matter what’s going on in the market, the media or the world, one question we get time and time again is should I rent or sell my investment property? The answer we give each time is, “it depends”.

There are a number of factors that need to be properly considered before you decide on what to do with a property you’re ready to move on from, whether an investment or family home. We’ve put together a guide that outlines the key considerations that will help you make a decision.

If you’re looking for individual advice on your property, you can get in touch with us, and we’re happy to help in any way we can. Although we know a lot about the property market, we’re not financial experts, so you may also need to consult an accountant or mortgage broker for professional advice about the monetary side.

When should I sell my property?

Whether you need more or less space for your family’s changing needs, are looking to grow your investment profile or just want to know your options, there are many reasons you may be considering selling your property.

Although there may be excitement about the house hunt or some anxiety about the current market, don’t be tempted to jump the gun and make a decision too quickly. Before choosing the best strategy, you need to ensure you have all the information in place.

If you’re considering selling a property and buying another or renting it out, you need to know:

Your property’s value.

Start with how much you initially bought it for, considering other investments such as renovations. You will then need to know how much you could sell it for or what it could be worth in the rental market. Not sure where to start? Book a free appraisal with us, and we’ll let you know.

Your financial standing.

You need to know your financial position as intimately as possible. To start with, look at your cash flow, review your debts and make sure you understand your investments.

Your investment goals.

From retiring early, leaving behind a comfortable inheritance, or simply saving for a rainy day, make sure you have clear investment goals. You will also need to take into account how much time, effort and money you are willing to put in. If you’re not sure about any of the above, take a few steps backwards before deciding on selling a rental property and buying another.

Is it better to sell or rent my house?

While there’s no right way to answer this question or even a clear cut strategy, there are a few things you can use to guide you when making this decision.

  • The property market
  • Personal finances
  • Time and resource capacity
  • Sentimental value

The property market

If you’re considering selling property vs renting, you first need to look at the bigger picture. The property market is constantly changing, and what’s reported in the news doesn’t always represent reality. Make sure you’re up to date, understand the current market forces and have an estimate of what might happen in the short term.

If the current market forces allow you to rent your property for more than it costs to maintain it, renting it out may be the option for you. Low vacancy rates are another factor that can indicate renting your property is a good decision as it means finding tenants will be easier. However, if it is difficult to find a tenant, will your finances support having an empty property until you find one?

On the other hand, if you want to sell your property, you need to make sure the timing is right. If you sold your property today, would you lose your initial investment?

Personal finances

Depending on your reasons for selling your property, your financial situation will determine whether it’s better to sell or rent your house. For example, if the property in question is the house you currently live in, and you need to buy a new one, determine how you will finance it. If you qualify for a second mortgage, renting instead of selling it could be a viable option.

Time and resource capacity

Before you rent out your property, confirm that you have the ability to manage it. A reliable property manager will help you with this, but there are still some responsibilities that come with it. Check out our great property management checklist to find more about the support you should be receiving.

When weighing up the short term costs versus the long term gain of renting a property or selling it, take into account the expenses involved. If you rent out your property, you’ll need to pay for rates, taxes, ongoing repairs and general maintenance. If you can’t afford to absorb these additional costs into your budget, you may need to sell the property. Consider the property’s condition when working out your budget, as you may need to do renovations or repairs to entice tenants or get higher returns on the sale.

Sentimental value

Although you shouldn’t let your emotions be the driving force behind your investment strategy, it’s worth considering the sentimental value your house has. If your property was the family home, you might want to consider keeping it to rent out if you’re not ready to let go or you want to keep it for your kids one day.

On the other hand, you might be too attached to see tenants coming and going, so selling it for a new family to enjoy might be the option for you.

So, is it better to sell a house or rent it out?

Everyone has different circumstances, financial situations and investment goals. There is no one size fits all answer. Before you make a decision, talk to financial advisors such as mortgage brokers or accountants and a property expert so you can explore all of your options in detail.

Got a question about the current Perth property market? We’d love to help. Get in touch with us anytime or book a free appraisal to start the conversation on how much your property is worth.

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Shirley Smith

Founded
in1995


In 1995, Founder Shirley Smith (Photo) started Access Property Management realising there was a high demand for a dedicated property management agency.

ORIGINAL FOCUS

Shirley’s original objective was to provide a closer link between property owners and high quality tenants provided by relocation companies and the corporate/executive sector. Over time we extended our services to better cater for the needs of all property investors and quality tenants, who were seeking a higher level of service, focus and experience.

25+ YEARS EXPERIENCE

For over 25 years, our family owned business has made an impact within the real estate industry in Perth Metro and based on our results we’ve established a strong reputation for integrity, distinction and innovation in real estate and management services.

“I rented a property through Natalie at APM. She was attentive, proactive and professional – everything you could want in a property manager (as a tenant and as a home owner, as I am myself also). I highly recommend APM, their professional staff and convenient services.”

Daniel – Mt Pleasant – Facebook

“I have been using their services as a tenant, and I can say its an amazing experience. They are prompt at everything and quite helpful. Alongside, the property manager carry a great professional work ethics which is wonderful. You, as a tenant always feel accompanied by your property manager. Cheers.”

Rahul – Google

“I have rented through Access twice since 2010 and both times have been great, particularly the last time when I rented in South Perth and my rental agent was Kelly Duncan. What a delight she was and is and nothing was too much trouble. Thanks Kelly for such a great experience. Shame I couldn’t stay with you.”

Vanda – South Perth – Facebook

I would like to personally thank Kelly for her professionalism and pleasant manner when we were applying for a rental. My son Jarrod (18yrs) & daughter Nicole (22yrs) had been applying for rentals all of January with no success & I was disappointed that some of the agencies hadn’t even followed up on their good references to allow for a fair assessment of their application. As Kelly would know we were successful in this application but had to decline as we were also successful in purchasing a property in that same week. Kelly was very understanding and a pleasure to deal with. I will highly recommend your agency .

Heather – Prospective Tenant

“Many thanks for your help.  I have a couple of other properties and you guys are by far the easiest to work with and most professional.”

Dean – Owner

“It is always fantastic to deal with Stacy and the team at Access Property Management. Highly recommend to anyone!”

Anike – Facebook

“Mark, Stacy and the team at Access you are a pleasure to do business with. I highly recommend to anyone that requires high level, professional property management.”

Brett – Facebook