Should I Rent or Sell my Property?

When’s it time to move – it may be work-related relocation, upsizing, downsizing, or other reasons; the big dilemma many home owners face is whether to sell or rent their existing property.  Whilst each situation is individual and very much circumstance-driven, below are five factors to consider that you may find helpful.

Financial:

This is critical in the decision-making process – what makes financial sense?  You will need to consider your personal financial situation and calculate the cost of covering maintenance, rates, and insurance on two properties.  Furthermore, can you cover two mortgages in the event of a period of vacancy.

Emotional:

Many owners are emotionally attached to their principal place of residence; this can make both the selling and renting process challenging.  If renting, you will need to prepare for the fact that it is unlikely anyone will cherish and look after your home the way you did; if selling, the things that endeared you to your home may not be of appeal to buyers, and negative feedback can be difficult to deal with.

Demand:

What is the health of the local market?  Is it buoyant, are properties selling quickly and achieving good prices?  What is the rental demand in your area?  Supply and demand is a huge driver of market activity, and in a flatter market, you may decide to rent out until it becomes a seller’s market again.  If the market is strong, then it is generally an opportune time to sell; as the market has proved over time it always goes up and down – make hay whilst the sun shines.

Growth:

What are the future plans in the area for your PPOR?  If there is potential developments/infrastructure that could see the region boom in future years, it would make good sense to keep the property and rent it out to reap capital gain further down the track, at a level you couldn’t achieve today.

Stress:

If you keep your PPOR, are you going to self-manage, and if so there are a plethora of regulations you must be aware of and comply with that constantly change.  Self-managing can be extremely stressful and unfortunately, some of the ‘horror’ stories we read about in the media occur in properties managed by owner.

Investing in professional property management should relieve any stress, and save you time, and in the long-run money, if the property has been consistently tenanted and well looked after.