The decision to sell or rent out a home is a big one, and it will take a lot of consideration to make the right decision. Fortunately, there are several ways to decide if selling or renting is right for you.
The biggest factor that will determine if you sell or rent is whether or not you can get a mortgage for a new home while you rent out the old one. This is often determined by the bank giving the mortgage, and it can be difficult to predict their decision. Having a good credit history and the income to support both mortgages can help to qualify for another mortgage.
Next, look at how much similar homes on your area are currently renting for. The improving rental market in the Dallas area means that homes are renting for more than they did just a few years ago, so talk to your realtor and get a current picture of rental prices.
Use this number to run a cash-flow analysis of your property. Consider how much you spend each month on your mortgage payment, taxes, maintenance, and insurance, and compare this amount to the amount of rent you will receive. Next, consider these number if you were to pay off your mortgage and/or refinance your house. Also consider the investment value of the property. By holding onto your old home for longer, you will be giving yourself time for the market value of your home to rise.
Finally, consider if you are ready to be a landlord. A property manager can help you to learn what is in involved with owning investment property. Really consider if you are willing to deal with the issues that rental properties can bring.
Renting out your home can be an excellent financial decision. Renting a home can provide you with monthly income and a large asset, but it is important to be ready to become a landlord.