Should I Sell or Rent My House? Selling a Home in a Recession

In this economy, it should come as no surprise that many home owners are tending now to think twice about selling a home. As a way of putting that decision off, at least until the housing market has a chance to bounce back somewhat, some homeowners have come to the solution of renting a home. It sounds like a good resolution, but is it really the best answer for them?

I had the same dilemma (along with my family): should I rent or sell my home? We decided to look into renting our second home in Pismo Beach instead of selling it, as was the original plan. Besides the obvious worsening economy, there were a few bad(and good) points we found out in our research.

There is a great number of houses for sale now - twice as many, some say, as there were only a few years ago. This, along with relatively low number of buyers in the market, makes selling a home in a recession uneasy for anyone. It's difficult to say how badly you may fare in the price department, but depending on where you live, you could struggle to not lose money on your home at selling.

There are disadvantages too to renting your home - you are in effect, a landlord. No, you're not responsible for anything as time-consuming as an apartment complex, but you will have to spend at least a few hours a month with management responsibilities.

The worst possibility though of renting your home is what we feared in our decision and which we're still wary of: will they trash the place? Of course, we will require a deposit, but it's a lovely home and what if by some real disaster the deposit doesn't cover the damage? All things to consider and probably what thorough background checks are for. Regardless of the "niceness" of your renters,some people basically don't care for others' homes like they do their own; another consideration is if they have children, as this will definitely up the possible damage.
I don't mean to scare you, as I doubt your renters will be swinging off your chandeliers and giving their children permanent markers to ruin your walls, but it's just something to weigh as a possibility.

Another point to consider on whether to sell a home is whether or not you simply need the money now. You may
not get the price you could have a few years ago, but you may still get your money back with a profit. A good online tool for determining whether selling or renting is the best decision for you is at http://www.forbes.com/tools/calculator/caprate_rent_vs_sell_house.jhtml.

Which choice will be the best for you, selling or renting your home, has to be ultimately decided by your common sense,research and your gut. Find out how much you can expect your home to sell for in your area. If you'd rather not have the landlord responsibilities of renting a home, you can always hire a property manager. If you don't like the price you see your home likely going for, you can always rent.

Or you could do both as I and my family have: decided to rent out our nice home to some nice people, and finally sell when the smoke clears.