Should I sell my paid-off house or rent it?

Asked by Diana Phillips, 39507 Mon Feb 9, 2009

I'm a single professional female ,46, who inherited the home I in. It's quite modest but it is the only true nest-egg I have. I live in Gulfport MS and would like to move back to a metropolitan area for better career options but recently found out that my homeowner's insurance company does not offer insurance if the property becomes a rental. I think this fallout from some Hurricane Katrina-related insurance changes in the region. I'd like to keep the house just to know I always have a home to go to, but am also aware there could always be another bad hurricane and if the property is a rental, even with alternate insurance, FEMA will not assist and getting insurance pay out may be iffy. Am I better off just selling and taking a less than ideal price to go to an area where my investment would be safer? Even if it means using this as a down payment and taking out a mortgage at my age? If there's something I'm not considering, please let me know. Any advice/input appreciated.

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8
Lazaro Rovira, Agent, Pascagoula, MS
Thu Jul 4, 2013
Hi Diana,

It depends on what you want to do, the good thing about renting ( If you can get insurance ) is that you have a monthly income but if the tenants don't pay or don't take care of the home it can become a huge headache if you wont be around locally. If you can take that money and invest it where you are going it may be a good idea but once again it all depends on what you want to do.

If you have any questions please do not hesitate to call me.

Good Luck!!

Lazaro J. Rovira
RE/MAX Along The Way
228-365-8034
RoviraTeam@Yahoo.Com
http://Www.RoviraTeam.Com
0 votes
Jennifer Joh…, Agent, Gulfport, MS
Mon Jul 30, 2012
Diana,

Hi, my name is Jennifer Johnson with South 2 Real Estate, a local Real Estate company here in Gulfport. I agree with Bill on seeking insight from a professional Realtor. We are also a property management company as well so we have the expertise of both sides of the field you are concerned about. I would love to have the opportunity to sit down with you and go over any details that you may be concerned about or have questions about.

You can reach me at my office at 228-832-8863 or on my cell phone 228-697-6448 or shoot me an email msrealtorjj@gmail.com.

I look forward to talking with you!

Best Regards,
Jennifer Johnson
Realtor/Property Manager
South 2 Real Estate
228-832-8863 Office
228-832-9588 Fax
228-697-6448 Cell
msrealtorjj@gmail.com
0 votes
Katie Dauro, , Long Beach, MS
Wed Jan 18, 2012
I would change to Farm Bureau insurance and rent it..... Its what I have for my personal rental homes.
With more and more foreclosures, people need a place to rent. Also if you allow small pets it puts you above the rest including apartments


Good Luck
0 votes
Margie McFar…, Agent, Gulfport, MS
Tue Mar 23, 2010
I wish I could give you the magic answer. I live here in Gulfport. It sounds as if you want to venture out and I think that is great. My suggestion is sit down and decide how important it is to hang onto your home or is it ready to let go and move on. If a rental, you are still responsible for ins and upkeep unless worked out in lease but it will still be in your name so you need to keep ins. Are you willing to price your home to sale and sell it as is.? The market is picking up at a slow rate but homes priced right to move. I know I did not give you an answer but would love to talk with you.
Margie McFarland,Agent/Owner The Real Estate MarketPlace
margie.mcfarland@gmail.com
0 votes
Kimberly Kin…, , Clackamas, OR
Mon Feb 9, 2009
First I would check with more than 1 insurance company on coverage for a non-owner occupied home. Second I would say their are many tax advantages to having a rental. I have many rentals and the tax benefits
are astounding. I would contact an tax accountant and go over the pro's and con's of renting this property.
0 votes
Lisa Reeves, Agent, Tampa, FL
Mon Feb 9, 2009
It looks like you need some advice from a couple of people. One is going to be an insurance agent. You can get an insurance rating on the companies to determine how financially sound they are before you pick one. Find one that is either guaranteed by your state (if they have this like Florida) or has a B+ to A+ rating. This will protect you and your property whether it is a rental or a primary.

Second you need to find out the tax liability because rental income is taxable but rental payments are not tax deductible so find out first if benefits you for tax reasons to hold the house or take a hit.

Third talk to a realtor about the time on market - if it seems like it may take a while to lease or to sell - you may jeopardize any job opportunities if you don't know the time on market for your area.
0 votes
Joel Elgee, Agent, Liberty Lake, WA
Mon Feb 9, 2009
Diana,
Depending on your risk tolerance this sounds like a scenario where selling the home would make the most sense. If you decided to keep the home it sounds like (at best) you could find some way to insure the property but that the "what if's" will continue to linger in your mind. Given the current market conditions in real estate in most areas, you may have to take less that the ideal price for your home, but you'll have a great buying opportunity after you sell the house and liquidate the cash.
Web Reference:  http://www.joelelgee.com
0 votes
Bill Eckler, Agent, Venice, FL
Mon Feb 9, 2009
Diana,

You require the insight of a local real estate professional. Someone that knows the area well and has a realistic understanding of the marketability of the home and how much it will bring in today's market.

With accurate sales information it will be easier to project the net difference between selling at a lower price and renting.

Good luck
0 votes
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