Moving? Not Sure About Selling? Consider Renting Your Property

A desire to relocate, or the opportunity to seize your dream home can create an agonizing decision to sell your property or rent it out instead. Well, considering the hot rental market, you may be motivated to hold on and let the property pay for itself as it gains value.  Plus, if you manage the property yourself, it can be a significant source of income. By renting your property instead of selling it, you can reap numerous benefits such as gaining equity while paying off the mortgage with rental income and having your property appreciate in value over time. Offering rental property options to tenants can give you peace of mind and provide the financial freedom to do what you want.  

It can be a viable solution when it comes to gaining equity and building long-term wealth. You can use the income earned from renting your property to pay off your mortgage while watching the property’s value increase in time. This means that, after several years of property rental, you could have an asset that is worth more than what you paid for it.  

As a property owner, you can enjoy the advantages of renting out your property without having to invest much effort. You can choose to hire an experienced property manager to handle all the paperwork and tenant issues while ensuring they are taken care of properly. You can also opt to self-manage and take care of rent collection, property maintenance, tenant screening and other property management tasks. Renting out property can be a great way to gain equity and earn money. As you pay off the mortgage, you will benefit from the appreciation in value of your property over time. This is an attractive option for property owners who are looking to make long-term investments and build wealth. 

Benefits of Renting Your Property  

Renting property can offer many advantages. One of the biggest benefits is that it provides a steady income stream, allowing property owners to cover their mortgage and other expenses associated with owning property. Additionally, rental properties tend to appreciate faster than non-rental properties due to the demand for housing in certain areas or neighborhoods. This appreciation can provide an attractive return on property ownership.  

By renting your home, you can change it from a financial burden to an investment that makes money. You will need to have money set aside for when the property is unoccupied and for any required maintenance. 

Tax Advantages  

In addition to gaining equity, property owners can benefit from tax advantages associated with renting property. For example, property owners may be able to deduct certain expenses related to their rental property such as maintenance and repair costs. Additionally, property owners are allowed to claim depreciation for their property over time. This depreciation can reduce property owners' taxable income, giving them more money in their pocket each year.  

Long-term Gains  

Finally, property owners who rent out property can benefit from the long-term gains associated with real estate appreciation. As property values rise over time, property owners can sell their rental property for a higher price than what they purchased it for, giving them a healthy return on their investment.  

Renting property can be a great way to gain equity and earn money over time. With the right strategy and property management plan in place, property owners can position themselves for success and reap the rewards of renting property.  
 

How to Make More Money by Renting Out Your Home 

Renting property can provide you with a steady monthly income. Taking advantage of this steady stream of income can help property owners pay off their mortgages and other property-related expenses while watching the property’s value increase over time. This is an attractive option for property owners looking to make long-term investments and build wealth in the process. By renting property, property owners can benefit from the rental income generated from tenants. This extra money can be used to pay off property-related expenses such as mortgage payments and taxes, or saved for future investments. As property values continue to rise over time, property owners who rent out their property can benefit from the appreciation in property value and be able to sell their property for a higher price than what they purchased it for.  

Signs you should rent out your home 

The housing rental market, including rentals, has remained strong over the past few years. 2022 saw a nationwide average increase in rent of 11%, and as of Q4 2022, Canadian Real Estate Association reported that "the monthly rent growth trend showed strong momentum in October, with rents rising 2.2% from September. In the period since March when interest rates began to rise, the average rent in Canada has increased by 9.2%, which compares to a nearly equivalent 9.9% decline in benchmark resale prices between March and October." 

Obviously, rental markets vary depending on location, so do your research for the area you are interested in. Although it may be tempting to rent out any property in a market where rentals are high in demand, not every house will earn you money. Before you commit to being a landlord, run your property through the “rental litmus test” to ensure that it makes financial and logistical sense to take on a tenant. 

• You have a property that is in high demand.  

• You can cover your property-related expenses with rental income. 

• You are looking to make long-term investments and build wealth.  

• You are prepared to manage property-related tasks such as collection of rent and property maintenance.  

• You are able to responsibly handle tenant issues that may arise.  

Renting property can be a great way to make money while protecting your investments over time. It requires some work, but the returns can be significant. If you are considering renting property, consider these signs to decide if it’s the right option for you.  

It provides property owners with multiple advantages including steady monthly income, tax advantages and long-term gains from property appreciation. Property owners who are looking to make long-term investments and build wealth should consider renting property as a viable option. Signs that property owners should rent out property include having a property in high demand, being able to cover property-related expenses with rental income and being prepared to manage property-related tasks.  

By following these tips, property owners can position themselves for success while reaping the rewards of renting property.  

Many property owners may not have the time or knowledge to properly manage a property. Portsmouth Residential can help further in guiding homeowners managing their properties. PR provides access to a wide range of property management services that can make the process easier for landlords, including tenant screening, rent collection and property maintenance. With PR's help, landlords can feel confident that their property is being well taken care of, allowing them to focus on other investments. For more information on Portsmouth Residential's property management services, please visit our website.  

Read more: Cost of Self-managing your unit