Renting a Home...Pros and Cons

Renting a home could be an option along with its selling. There are many reasons due to which renting a home can be a good option. If you are moving some where for short period of time like for your studies or for any short term project then many people consider renting is a good option instead of selling their home. Similarly if property prices are going down and you are not receiving a reasonable price then its better to rent out your home and wait until market prices would get better.

Pros:

• Normally property value is increasing with the passage of time. If you rent out your home then it’s going to appreciate. So in future you can receive better cash flows.
• Due to the mortgage and interest payments, landlord can gain tax benefits.
• Renting out your home is also a source of income. As you move out, your home is not vacant. So instead of keeping it vacant, you can earn income by renting out your home.
• When you rent out your home then you meet with many people. So your social network increases.

Cons:

• As you rent out your property, there is probability that tenants may damage it.
• If your landlord is a bad person then he can cause a lot of trouble for you like interfering in your privacy at any time etc.
• Repairing of home can be a headache if tenants call you at unusual times. Suppose if tenant calls you on Sunday at 7.00 am that toilet pipe has burst then it would be difficult to repair at this time. So when you rent out a home then to manage repairing can be a difficult process.
• When you sell home then you receive payment in full amount. But when you rent out your home then you have to receive monthly payments. Unpaid rent or tenant’s rights could be a matter of dispute.  
• Some land lords contact with tenants through property management companies. These companies charge fee 3% to 10 % which is an expense.