To Rent or Sell: How to Choose What's Right for Your Kona HI Home
27 September 2019
Hawaiian Dream Properties
You own your Kona home, but perhaps you need to relocate to the mainland. Maybe you have a new job opportunity off the Big Island, or you're downsizing (or upsizing) to something that better fits your lifestyle. Whatever the reason to leave your home, you have to decide what to do with it. There are two main options, one of which might surprise you: sell it or rent it out.
Have you thought about owning a rental property? It's easy to overlook the option of becoming a landlord when you need to move out of a house that you own. However, investment properties are one of the best ways to make passive income.
Being a landlord doesn't have to be complicated, but your decision to sell or rent requires some serious research!
When Selling, Research Is Crucial
If the real estate market is good, it might be the perfect time to sell your home. It’s a traditional solution that allows you to walk away from the hassle of keeping your current home while moving to a new one. You’ll also have income straight-away rather than rental income month by month.
Before you sell your Kona home, consider your return on investment. The current market can either be an excellent time to sell, or it can cause you to lose money, depending on a few factors:
How long have you lived in the house? If you haven’t lived in your home long enough to build equity, you could lose money on a sale.
Have you made any updates or improvements to the home? Depending on the type of improvements and how old they are, this can affect the sale price of your house tremendously.
If you’ve made updates, how much money have you put into the house? Whether you’ve spent a lot or a little to keep the house in good condition or make renovations, it’s critical to recovering the amount you’ve put into it.
If a sale right now means you lose money, it might not be the best option for your finances—or your future. Thankfully, there's another alternative.
Renting Might Be Right for You
If selling isn’t the right option, what do you do? Consider turning your Kona home into a rental property!
You’ll still need to do the research to make sure your home can be a profitable investment as either a long-term or a vacation rental property. Here are some things to keep in mind when evaluating the rental market and your property:
How many homes are rentals in your area? If it’s the right mix of rentals and non-rentals, your home could be in-demand in a respected neighborhood.
How many of those rentals have tenants? If there’s a high vacancy rate, look into the causes of that issue. You want your home to find quality tenants and stay occupied.
Is your community an attractive place for renters? Renters appreciate good schools, plenty of restaurants and nearby activities, and easy access to major roads.
How much could you charge for rent? The number you have in mind might not be reasonable for similar homes in the area. Make sure you can earn a profit with the right rental price.
What are the potential monthly expenses? Factor in common landlord costs. You’ll have different expenses when your private property becomes a rental property. If you're leaving the Big Island for a job opportunity, you'll have to factor the distance in as well.
What is your monthly income if you lease your home? When you compare the “goldilocks” rental price to your estimated expenses, make sure your home would generate a net profit.
There’s a lot to consider when putting your home on the rental market, but don’t let that discourage you! You don’t have to do it alone. Hawaiian Dream Big Island property management is here to help!
Expert Property Management Can Help You Decide
A property management partner in Kona can help you determine what’s best for your property. When you work with experts, they’ll help you make the best decision for your finances.
Your property manager has access to the rental market analysis information you need. They’ll guide you through analyzing the rental market in your area, and they'll recommend a monthly rental price for a long-term rental. A property manager will also advise you if your home would be better as a rental—or if you should sell.
Decide What’s Right for You
The decision to sell or rent comes down to what works best for you. If signs point to renting your Kona property as the best option, don’t be intimidated by the work that goes into being a landlord.
Hawaiian Dream Properties can help you determine what’s best for your home. When you decide to make your home into a rental, we’re ready to manage the property for you! As a home rental company in Hawaii, our team handles everything from choosing the best rental price to listing your home and finding the right tenants.
We also take care of maintenance and paperwork to help you have a hands-free, genuinely passive income experience when you turn your home into a rental. Start with our FREE Property Analysis! It’s the first step to making the best decision for your home.