If you’ve lived in your home long enough to the point of owning it, you may have given thought to the prospect of renting it out as a source of income. Perhaps you’re moving into a new home but are wondering if renting out your current home could add a little extra money on the side. If that’s you, consider reading further to decide whether or not this may actually benefit you. Here are some reasons renting out your home may not be such a great idea:
Renting out the property such as a home comes with many costs. It’s not just mortgage payments you’ll have to look out for. You’ll also have to cover maintenance costs for anything that breaks that’s not covered by insurance, pay for insurance itself, pay for property taxes, and more. The main thing to consider is this: will you still make a profit after all expenses are covered? Depending on what the monthly rent is for the tenant, it may very well still be a profit. If it isn’t, however, this alone could easily steer you clear of renting out your home.
Let’s face it: whether you’ve been a part of a church, a college, or lived in a home or neighborhood for a long length of time, you tend to grow attached to those places. Likely you’ve made many memories in your home over the years. You’ve hosted gatherings, raised your kids, had many Thanksgiving and Christmas times there, and slowly built more and more into the home to truly make it your own.
Deciding to rent out that space doesn’t immediately take away the fact that complete strangers will be residing in what you’ve considered home for many years. They will likely have different ideas of ways to make it their home. Over time, there will be wear and tear on the house that comes naturally. Perhaps they will have ideas of redecorating that frankly turn you off. These things and more could make it not worth renting out your home, particularly if you decide you either don’t need to or could sell it instead.
Family wants to rent
This actually almost happened to my wife and I when we first got married. My wife’s parents decided to move to North Dakota while we still lived in Missouri and offered to rent out their Missouri home to us once we were married. I was already living in an apartment that was pretty decent and in a good neighborhood. In the end, we decided not to rent from family. One of the biggest reasons for this had to do with possible family tensions in the future. We wanted to own pets, and pets were strictly forbidden in their home.
We could paint but it had to be colors they liked. The list goes on. Instead of getting into contentious discussions about what would and wouldn’t work, we decided to make our own way and live independently. You may be like me and get along great with your relatives on a normal basis. Unfortunately, renting out a piece of property is ultimately a business; and there will be times when tough decisions have to be made that one party or the other will not like. Be very mindful if the opportunity to rent out to family comes up. It may not be what it seems.
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