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We've been stuck in our house for eight years (we planned to stay in the area for five) because it depreciated so much after we bought it and the market hasn't corrected. At all. My husband is dead set against renting the house out, but I WANT TO GET OUT OF HERE. It's not that the area is bad (it isn't) we just really always planned to move closer to family and the kids are getting older. And older. We would need a rental agent to oversee things for us (we have one in mind).
How bad is it to rent out your house, really? Give me the good, the bad, and the ugly.
I have only rented one property that I had lived in because we couldn't sell it.
First couple (professionals) lasted 6 months before they moved in to a house they were having built. Didn't bother to inform us of this fact when they signed the lease. She worked for a law firm, so she had all of her ducks in a row. Paid for advertising & rent until we could re-rent. Didn't take very long at all. Great tenants while they were there.
Second renter was a single male in his mid-30's who was biding his time until he had to purchase a property to live in so he wouldn't have to pay capital gains. Rented from us for a year.
Third renters were two young (early-mid twenties) female physical therapists. Cultural differences & the fact they had just moved out of graduate housing dorm life....they were a nightmare. Thankfully we sold the condo before the end of their one year lease and didn't have to deal with them any longer.
I have a good friends who are a military family. Bought a house in Va., didn't think they'd have to move again, but ended up on the left coast for two years. Rented the house out through a property management company. Didn't end well, but only because their "friend" was a realtor who worked for an RE agency that also offered PM services. So they signed up.
They (my friends) didn't do their homework. They didn't ask for references or read the "fine print" in the contract they signed. Came back to bite them in the rear-end, but my girlfriend is so sweetly manipulative (she plays the role of "southern belle" very well) she went after the renter. He was a big-wig local preacher in a certain community...his name was on the lease.
He had moved his mistress and her kids in to my friend's house.
I don't know when he stopped paying the rent, but it was in to the second year of the lease. When my friend moved back east and back in to her home (don't know how she did it, it was gross), she had zero help from the PM company collecting back rent owed her. So she eventually pulled herself up by her bootstraps and did her research on him. Went to a higher up in his church. Played her, "Bless his heart and what he does for the local community, but I just want him to do the right thing by me and in God's name" card. "Maybe I should contact his wife since he won't answer my phone calls and his secretary has given me the run around every time I show up and ask to speak with him?" Paraphrasing, of course, but that was the gist of it.
The "higher-up" (eventually) paid this guy's back rent out of church funds. Somewhere around $10K.
I had rental hoses at one time. There are some good (nearly perfect) tenants. Then there are the others who will trash your house and not pay the rent. If got so bad that when I went into district court to file papers for eviction they knew my name when I walked up to the counter.
Great if you have good tenets and the property is rent-able and not need to repair for twenty years , or you will be back fixing the place up for higher rent returns .......so it is best to have a superintendent over of property who is local who will visit the property and may even have to grass cut and drive way snow plowed for authority to the tenets who will then be under the superintendents , other wise you should sell the property at cost and get out ........
We've been stuck in our house for eight years (we planned to stay in the area for five) because it depreciated so much after we bought it and the market hasn't corrected. At all. My husband is dead set against renting the house out, but I WANT TO GET OUT OF HERE. It's not that the area is bad (it isn't) we just really always planned to move closer to family and the kids are getting older. And older. We would need a rental agent to oversee things for us (we have one in mind).
How bad is it to rent out your house, really? Give me the good, the bad, and the ugly.
We rented out homes for many years, no problems but in 43 years of marriage we agreed on when to rent homes when to sell homes when to live in homes. Agreed on how to live. That is the thing, no rehearsals, this is your life, your lives together---or not.
After what I saw my aunt go through I say sell and move on . My aunt rented to this couple and she ran everything on them and then after they moved in , they moved in her sister and others and had mattresses on the living room floor and the dining room floor , after they were evicted we went into the house it looked like ww3 had gone off inside , we found scrape marks on the hardwood floors where they slid something across the floor and it also had gouge marks and looked like they just ripped off the pictures on the wall . In other words the house was a disaster . My aunt had to have the house professionally cleaned and painted etc .Even with a thousand dollar deposit my aunt still had to put more money in ...never ever again did she rent that house she sold it . This is why I say sell it and move on .
First couple (professionals) lasted 6 months before they moved in to a house they were having built. Didn't bother to inform us of this fact when they signed the lease. She worked for a law firm, so she had all of her ducks in a row. Paid for advertising & rent until we could re-rent. Didn't take very long at all. Great tenants while they were there.
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Just because someone works in a law firm or is a lawyer it does not mean that they can violate the lease or leave in 6 months if they signed for a year.
If you decide to rent your house out do background checks, get several references, look at their social media, etc. You can also consider asking for a very large deposit to deter the people just looking for a place to move in and not have any recourse or responsibility attached to it. If it's legal in your area, I'd ask for the first month's rent up front along with a deposit that equaled 2-3 month's rent.
No point in living in a place that you dislike so much- life is too short!
My father had a neighbor who bought the house next to him to rent out. They didn't do their homework because the lady stopped paying the rent, and it took the guy over 6 months of no rent to get them out, plus they rented the basement out to people they knew and still didn't pay rent. Just a freeloader who was looking for an easy mark and found them. Hopefully now that they have an eviction on their record it won't be so easy to fool others. My father said he never had an issue with the neighbors and they went out to work everyday. Some people just want to live life cheating others.
Did you consult a accountant on that decision ? I can't see how " a low 7 figure loss" was "less painful" than renting it out and making up for the decreased value on your taxes.
Yes, and since it was a primary residence (vs an investment property), no write off.
The pain caused by renting it out would have been related to watching a beloved home be destroyed by renters, having to deal with it cross country (even with a property manager), and waiting years for the value to get back to what we paid in 2007. It still hasn't. You'd have to know the market in the Phoenix suburbs to understand. Sometimes ripping off the bandage quickky is easier than a slow tear.
But I will say this: if that house had still had a mortgage, we could have and would have done a short sale, and financially been way better off. That adds to my bitter attitude about not being able to at least write off the loss.
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