If you have a property that you’re moving from or would just like to get rid of, you’re probably weighing up your options and considering whether you should rent it out or simply sell up and move on. Of course, both options have their benefits and downsides, so it’s a very personal decision and should be based on what you feel is right for you according to your own circumstances and also your goals for the future. To help make your decision a little easier, we’ve listed some clear benefits that can come about from renting your place out.
Benefits Of Renting Your Place Out
A Good Way To Experiment: When it comes to renting a place you already own, it’s a great way to get started with a bit of property development and to see what it would be like to make a side income out of investing in properties that you can later rent out or sell on for profit. With a property you own, you have a bit more in the way of freedom and flexibility with your property and it’s also a significantly lower risk than taking out an investor loan which generally come with extremely high interest rates.
A Great Way To Generate Cash Flow: Any source of secondary income that provides cash flow is great, but property is an especially great way to generate a consistent and high-value cash flow. You may be one of the lucky ones who’s completely paid off your mortgage, so most of the money you make from renting out will be clear profit, but even if not, you’ve probably lived there for a while or at least been paying the mortgage for a while so the cost of that has been going down and the rent you make will continue to go towards that and could still leave you with a little something to put towards savings or a second mortgage on another place if you’re looking to move up the property ladder.
Possible Tax Benefits: When looking to rent out, many people overlook the possible tax benefits available to them. Whilst you may not generate a lot or any immediate cash flow from renting, you could be looking to rent because you need to relocate temporarily, and due to this you could be eligible for tax breaks for the rent you’re paying on the other home – meanwhile your own mortgage is still being paid, so you’re basically breaking even.
Helps You Build Some Financial Security: No one is going to say they don’t want more financial security, and having multiple properties that are creating income for you is truly one of the best ways to build this. Whether it’s for your pension or for a nest egg to pass down to your children, renting out property is an ideal security blanket.
You’ll Learn From The Experience: The idea of renting out is something that’s pretty scary to a lot of people, and for good reason – there’s a lot of horror stories out there from people who have done it and been badly burned, but the good news is, there’s a lot more to gain, and even more chance that you will gain from it. As long as you do your research and work with professionals, such as companies who are experts in helping landlords find great tenants, you’ll likely have very little issues. Of course, everything is a learning experience and you’ll become more experienced as you continue to rent out, so if it’s something that will benefit you greatly, then maybe it’s worth a little risk. It will also help you if you get to know some local companies like roofers, electricians and other tradespeople who you can have on call for any repairs that need carried out.
You Could Benefit From Increasing Property Prices: Although the value of property is something that constantly fluctuates, if you rent during a time when property is more expensive, you’re benefiting from this because as your mortgage is going down, the value of your property is increasing, so you’re in a great position.
This is, by no means an extensive list, but it should definitely provide you some clear information to help you when it comes to making this decision. Whilst there are definitely some downsides to renting, and a lot of times when it doesn’t make sense, but if you live in a high value or sought after area, such as a city or great family neighborhood, renting out could be the perfect thing to do.
*This post is a contributed article. Thank you to the brands for providing these as samples to share with my readers!*