Own a condo? You’ve skipped a lot of headaches and challenges that homeowners have and currently are dealing with. While they do have some advantages you would appreciate, you’ve had an affordable place to live that has remained cost-effective with minimal repairs. Maintenance costs and needs for a condo usually are far more affordable over an extended period of time when compared to that of a house.
So, you own a condo and now you’re debating what to do with it. Normally, the ideal would be to sell it and cash out. However, there are two things that are bothering you with that idea. The first is the current market. Inflation rates have made purchasing a new property very difficult. The other thing you are noticing is that your monthly costs for that property are far more affordable because of your interest rates, taxes and insurance.
Benefits Of Renting Out
Again, because you have low monthly costs on the property you have a unique opportunity to rent it out and make a nice profit each month. For example, if your mortgage is $500, which includes taxes and insurance, and your HOA is $500 a month, along with other costs, you can estimate that you will have to pay on average $1200 a month for the property. You take a look at what local apartments are renting out for similar size and see that you can easily rent yours out for $2,000 a month.
That’s a free extra week’s paycheck that you get for renting out your condo. You still own the property and when the market improves, hopefully including values, you still have the option to sell. However, for now, you can have a great passive income stream that will benefit you as long as you want.
Benefits Of Selling
Finding a renter, managing the property, answering calls, having to cover repairs and plenty of other reasons make it easy to understand why you should sell. The other reason is the money. What if you can clear $50,000 or more from the sale? If you have an option of where to live that does not involve the condo, that’s a nice chunk of change to walk away with.
You have to factor in the financial options with what is impacting your situation. Are you moving out of town? Maybe you do not want to manage a condo? Have you already purchased your new home? That extra cash may help big in covering repairs or improvements you need to make to your new property. Consider the finances and figure out how they impact your needs.
Best Options Right Now
Local markets are something you have to research to determine what your best options are right now. That’s where working with an experienced realtor is a great advantage. If you can get a better idea of what the local condo market looks like, that will become a major influence on your decision.
If you think that you can get top value, why not do it? However, if the realtor advises you to hold right now, renting may be the best option so that you can turn a monthly expense into a monthly source of income. That’s where that professional knowledge can be so beneficial and direct you to the best current option.
Look At The Numbers
What do the numbers tell you are your best options? If your numbers show you are looking at deciding between a $800 monthly paycheck or a big payment of over $50,000, you need to know those are both realistic. If they are, you have to determine which option appeals to you more. However, if the numbers show that the rent would only net you $200 or the condo sale would only leave you with $20,000 that may give you a better answer.
The numbers are going to simplify the process and decision making for you as well as help you to have more confidence in your decision. The key thing to remember in real estate is to list all your options and scenarios out so you know what the current and potential markets will do as far as impacting you.
Work With A Realtor
If you can work with a local, experienced realtor, that’s the best way to get the most accurate information and projections. Can you rent out your condo for $2,000 a month or more? This is the person to ask. Can you sell it for a major profit? This is the person who can answer that more accurately.
