Owning a rental house is a good way to make some extra money each month. However, there may come a time when you decide you no longer want to be a landlord and want to sell your rent house.
Whether you don’t want the hassle of dealing with the upkeep on the property or maybe the real estate market is strong enough that you stand to make a nice profit, selling a rent house is a little different from selling your personal house. That is especially true if you have tenants currently occupying the home.
Selling a rent house with a tenant living there can complicate matters quite a bit. In fact, most real estate agents actually recommend for you to wait until the current lease expires before you sell the home. Selling without having a renter in the place will be much easier for a number of reasons.
When you do not have a tenant, it’s possible to show the house anytime. Cleaning and staging becomes much easier too. Also, you can make repairs and upgrades without worrying about a tenant doing anything else to damage the house.
Of course, it is important to consider the flipside as well. If the tenant moves out, you need to make sure you can afford to have the house vacant while you are trying to sell it. You will have to pay for the mortgage, utilities, and upkeep on the house. In addition, you need to think about the security of the property when no one is living there.
It is possible to sell a home while you have a tenant renting from you. However, having a tenant on the premises when you are trying to sell can make the process more of a hassle. It will be more difficult to show the property, and it can be a problem if there are repairs that need to be made. Also, buyers that are looking for a home to move into will most likely not even consider looking at a house that is leased to a tenant.
Some tenants may be resistant to the change and may not want to move. They can make it more challenging to get a sale to go through. It’s important that you talk with them about selling as early in the process as possible, and that you get them on your side. Keeping the house very clean and clutter free, in addition to having the property available for showings as much as possible are crucial to finding the right buyer. Because tenants do not have the same incentives to ensure the house sells, find a way to incentivize them.
For example, as a way to entice them to keep the place clean and to make it available for showings, you could offer a discount on their rent, gift cards, or anything else that might be helpful to them. If you will be having an open house weekend, consider booking a nice hotel room for the current tenants to stay in. This will make the process easier on them and the people who are visiting the open house.
You also need to think about how the sale of your rental house will affect your taxes. If you have any profit from the house, you may have to pay taxes on it. If you lose money, there is a chance that you can deduct the losses from your taxes. To determine the exact amount of taxes you will need to pay, if any, when you are selling the rental house, it is advisable to speak with a tax professional. They can explain your total tax liability and capital gains.
Whether the tenants are in the house or not, you need to be sure it is ready to sell. This means you have to look at the repairs, large and small, that you need to do as a way to make it more attractive to buyers. Get a house inspection to look for any major repairs you need to make. In addition, think about some of the smaller changes and updates you would like to make. For example, you might want to paint the house, change out the cabinets or the hardware, or update the flooring.
Consider how much the updates and repairs will cost in comparison with other homes that have sold in the area. Will you be able to make enough money off the sale of the home to help recoup the costs of the upgrades? You have to strike a balance between making the home more appealing to buyers and not spending too much.
When you are selling a piece of property that you are using as a rental unit, you might find that it is easier to have some help from a real estate professional. They can help you figure out how to deal with the tenants you currently have in the unit, if you have any. They can also help you with the process of marketing, staging, showing, and selling the home to make things flow smoothly.
If you decide to sell your rent house give us a call or fill out our short form. We buy rent houses and will be happy to speak with you about your situation. Even if the tenant wants to stay, we can buy your rent house and close at a time that is convenient for you.
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