You bought a house, but for some reason, work, family or others, you have to make decisions for moving. Having two houses turns out to be a topic to analyze very carefully.
Having two houses can actually work and be profitable if you decide to rent one of them. Keeping one house, can make you build a wealth through cash flow and equity.
But how do you know if that is the right thing to do?
Should I sell the house and move on? Or should I rent it? As with most real estate questions, these are not “right or wrong” universal questions, but once you understand the options, you can make the best decision for your situation.
Below, we will detail some factors to consider when deciding whether to sell or rent your home.
Is there money flow from the property?
The first thing to keep in mind when deciding whether to rent your house or sell, it is to observe the calculations. First, ask yourself: will this property generate a positive cash flow?
In other words, when this property is rented and I deduct all expenses associated with the property (mortgage, taxes, insurance, utilities, administration, vacancies, repairs, etc.), the property will produce a monthly benefit or a loss? If you are throwing loss, consider selling.
What happens with my return on investment?
Next, consider how much you could get if you sold the property today, assuming you would lose about 10 percent in agent fees, closing costs and other sales expenses. If you earn little or nothing, it may be advantageous to keep the property, waiting for the market to improve over time. This is especially true if the property will provide a positive cash flow in the meantime.
A detail to analyze very calmly!
Does the future look bright?
Another important factor to consider when deciding whether to rent or sell your house would be to put your crystal ball and look to the future. How do you see the next five, ten, twenty years for the location of your home? Are things improving? Will your neighborhood decrease in value? If the future looks dark, consider selling now to avoid problems later.
Of course, we do not have crystal balls, but trying to measure where the market is going is not impossible. Take a look at the growth of your city: is it moving away from you or toward you? Are companies moving to your area? Are the houses being fixed or they are deteriorating? You can not know for sure 100 percent, but by analyzing current trends in your market, you can make a more informed decision about whether to keep or sell now.
Can you handle tenants?
Finally, ask yourself: are you willing to be an owner? Because, honestly, many people are simply not cut out for life. While some tenants are a dream to drive, others require a lot of time and patience to cope. You must analyze it, since it can become a topic of conflicts in your life if you do not have patience.
So, should you rent or sell your house?
If you are trying to make that decision at this time, take a look at the factors described above and choose the option that works best for you, your family and your financial future.
MLS Acobir, is the most preferred property list in Panama. Please contact us for all of your Panama Relocation and real estate needs.