If you find yourself wondering what to do with inherited property, you have two main options. You can either sell it on the market right away, or you can decide to rent it out. While the majority of people in this situation sell, some owners see that renting it out is a good deal. There are a few things to consider when you’re making this decision.
Money and Heirs
First, are you the only heir to the property? If you have brothers and sisters who have also inherited the interests in this property, you have to include them in this decision. You also need to consider whether you need the money today. If not, renting the home is a good idea, especially if it’s a house in excellent condition and in a great location.
Appeal and Terms
You also need to consider how rentable the home is. Will it be easy to find tenants for your inherited property? We can help you by gathering data that shows you how long it would take you to rent the property and what kind of interest we think it would generate. You’ll also need to decide if you want it to be a short term rental like a vacation home that’s rented by the week or if you want to rent it out long term with a one-year lease.
Property Management St. Joseph
If you do rent it out, you’ll need to decide whether you will manage the property yourself, or if you’ll hire a professional management company. If you’re going to self-manage, make sure you have the time and the skill to deal with advertising, tenant placement, maintenance, and everything else that goes with property management. You might want to talk to some companies about their services.
Cash Flow Potential
Is it going to cash flow? We can help you work this out while you’re making a decision. We will put together a proforma cash flow analysis so you know what kind of income and expenses to anticipate. If your rental income won’t be as much as your expenses, it’s typically not a good idea to rent the property out.
If you need some money now and there’s not a mortgage on the home, or just a small mortgage, you can refinance to get some cash and then keep it as an investment going forward. This might be the best approach – get cash now and earn a higher return on the cash that’s left in property.
We can help you through making the decision to sell vs. rent. If you have any questions, please contact us at Real Property Management SW Michigan.