If you’ve just inherited a home, you might be thinking about putting that property to work for you by renting it out. This can seem like an easy way to make some extra cash, but there are plenty of things to consider before you put out the “For Rent” sign.
We’ve broken down the pros and cons of becoming a landlord of your inherited property so you can make the decision that’s best for you.
Pros of Becoming a Landlord
Rent Can Provide a Source of Income
A monthly rent check can be a stable income, supplementing your current pay or providing for your retirement. After all, who doesn’t need a little extra cash?
Rental income can enhance your current lifestyle or ensure that you are able to do the things you’ve always wanted to do once you retire.
Property is an Investment in the Future
Aside from any income from rent, the property itself has value. If the home increases in value, you’re making money. Of course the property could lose value, but we’ll cover the disadvantages in the next section.
Be Your Own Boss
Landlords are essentially small business owners. You decide the price, you decide the terms, and you reap all the rewards. You’re the boss! This gives you a much larger say in your own future and financial stability.
Cons of Becoming a Landlord
Dealing with Tenants
Sure, you get a rent check every month, if the tenant pays on time (or at all). Delinquent renters are a serious problem, and taking care of issues like that can eat up a substantial amount of your free time.
A bad tenant could also be destroying your investment. If they are causing damage to the house or not properly maintaining the lawn or landscaping, you could be losing thousands of dollars on the value of your property.
Maintenance is Up to You
When the toilet breaks, you’re the one getting the call about fixing it. When the AC goes out in the summer you can expect to get a call once an hour. No matter what goes wrong, from the odd job to the complete replacement, you have to deal with the tenants and the repair company until the problem is resolved.
In addition, if the tenants aren’t doing their part to help maintain the property (i.e. letting you know about small problems before they become huge issues), your costs can skyrocket.
Taxes and Insurance
Don’t forget about the government, because they didn’t forget about you! Uncle Sam is going to want the property tax at the end of each year, and this can be a pretty big number if you haven’t been preparing for it.
You’re placing a lot of trust in strangers when you decide to rent your home, so insurance is another cost you’ll have to deal with as a landlord. You’re the property owner, which means that you’re liable for anything that happens on your property, and the proper insurance policy can be expensive.
There are many factors to consider before you decide to become a landlord of your inherited property. Make sure you take your time, consider all the options, and make the decision that’s best for you and your future.
If you do decide to sell the property, Local Cash Buyers is here to help. We’ll make you a written cash offer within 24 hours, and we can close in as little as 10 days. Contact us or call today and see how we can help you sell your inherited property quickly and easily!