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Cant Sell? Think About Renting Your Home

In some markets, it might make more sense to rent out your house if it's not selling, says Elizabeth Weintraub on About.com.

The real estate market is improving but experts agree that a full recovery will be gradual. Weintraub figured out that if a home that has lost 50% of its value in today's market and if the market were to see a 4 percent appreciation annually, the homeowner wouldn't regain that lost equity for at least 18 years. Sometimes the right choice is to rent rather than selling at a lower price.

"If a listing isn't selling, it's usually because of price," says broker owner Bill Bloomberg who has shifted his business focus to include high end rentals. "Today's renters could well become buyers of the future."

"Some homeowners decide to rent out their houses because they don't need to sell in order to buy another home. Others want an investment, and renting out the house might have been their plan when they bought the house." says Weintraub. "Still, other homeowners might be forced to rent out a house because they must move."

Weintraub suggests that if you don't want to handle the rental yourself, hiring a property management company might be the best thing.

"Management companies typically charge 8% to 10% of the monthly rent, but they will do all the work on behalf of the homeowner." writes Weintraub. "Moreover, there will be state and federal laws to follow. For example, all homeowners must comply with the Fair Housing Act. In addition, there might be county ordinances to adhere to and city fees to pay. A local real estate agent might be your best source to get recommendations for property management companies."

Read the full article at About.com

photo credit: dougww