In this video, Mendell Gosnell, CPM walks viewers through the decision of converting a personal home into a rental property. He outlines five primary reasons why renting can be advantageous—poor market conditions for selling, potential positive cash flow, long‑term wealth‑building and tax benefits, property characteristics that favor renters, and the flexibility rentals provide for future financial moves. He also lists situations where renting may not be suitable, such as lacking repair reserves, disliking tenant interactions, or being uncomfortable with landlord‑tenant law. Gosnell emphasizes that a professional property‑management company can mitigate many of the headaches of being a landlord by handling marketing, screening, maintenance, rent collection, and legal compliance (specifically noting Oregon regulations). The overall message is that, when the numbers work and the homeowner is prepared, turning a home into a rental can generate passive income, preserve equity, and open up future investment options, while professional management can make the process hands‑free.
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Should I turn my house into a rental? If you're thinking about moving or you just can't get the price you want for your house, can't sell it, and maybe you're wondering, should I turn my house into a rental? Well, it's a big decision and the right choice can generate long-term wealth, passive income, and major tax benefits. Uh, but there are a number of considerations. So I'd like to take a quick look together and see maybe some of the questions that you might consider as you take a look at answering this decision for yourself. So what are some of the key factors to help you decide whether keeping your home as a rental makes sense or selling it or doing something else? Let's take a look. Reason number 1, you know, that we see that, you know, the market sometimes just isn't ideal for selling., and you might be in a situation where you need to move or you're transferring out of the area and there's just no other, no better option. So in that instance, it could be, could be a smart move when you just, you can't sell right now. If the home is, home prices have softened in your area or buyer demand is slow due to interest rates like our current environment, renting your home gives you time for the market to recover. You can continue to have your mortgage paid down and get all the benefits of having a rental, ongoing equity growth. Again, waiting for that property, the property market to rebound and you get that future chance to sell at a better price. Instead of selling low, you let the market work in your favor. Another reason might be is that your home could generate positive cash flow. Depending on when you bought it, how you bought it, if it's a good rental, able to get a good rent amount. And so taking a look at that. So before deciding, though, you'll want to calculate kind of what your expected rent might be. And that's obviously what we do. We have a lot of software tools and resources to do that. But you can look on the market and kind of compare what other similar homes are renting for and There's websites out there like Zillow and others that will give you kind of at least a baseline understanding. Sometimes they're really low, sometimes they're too high. So there's other factors to consider, but that's a good starting point. You know, considering how much your mortgage payment is and your taxes and insurance. So all of your expenses, if you have HOA fees and then taking into account, you know, how much ongoing maintenance is going to be. And we have information on that as well. And can help our clients with that. But if the numbers, you know, show even modest cash flow, turning it into a rental can be a smart strategy. And even if cash flow is neutral, you still gain that mortgage principal paydown, appreciation, tax deductions, all while the tenant helps pay the bill. Then reason number 3, My favorite, and why I'm in real estate, is the long-term wealth building through rentals. A rental property isn't just a monthly income source, it's a long-term wealth strategy. And so, you know, some of the benefits include that equity growth over time. It's a hedge against inflation. So generally speaking, historically, real estate has beat inflation or kept up with inflation. So there's also the tax advantages. Real estate is very tax advantaged. You get stronger financial stability and growing, maybe the beginning of growing a real estate portfolio. So even one rental can significantly change your long-term net worth and just the overall retirement picture that you've got for you. Reason number 4, Your home's layout or condition might be better suited for renting. Some homes, they don't sell quickly, but they rent extremely well. So some examples include smaller homes, home with big yards or fenced yards, multi-level homes, properties in certain school districts, older homes that are sound. But even though they might be a little dated, suburban homes near employment centers. So if buyers are passing, but renters would love it, renting may be a smart move. Reason number 5, renters give you flexibility, or renting gives you flexibility. Turning your home into a rental, it gives you options, right? You can always sell later. You can always move back in later, you know, waiting till the market improves to sell. You can hold it for a long-term investment. You can refinance it. You can do a cash-out refinance. You can 1031, you sell it and 1031 into another property. You can convert it into an ADU in the future. And so selling, eliminates opportunities where renting holds on to those or potentially even creates more opportunities. So some reasons you shouldn't rent the home. Renting isn't for everyone. You may want to avoid renting if you can't financially handle the repairs. You don't want tenant interactions. You don't have reserves set aside. You're not comfortable with Oregon landlord-tenant laws. You want a clean, simple exit. But even if these issues are a hang-up for you, you know, a professional property manager can really step in and take care of all of these issues. You know, things like tenant screening, maintenance, rent collection, legal compliance, inspections, communication. And so, you know, a professional property management company really gives you opportunity to have a hands-free off stress-free investment. And so the last thing is how professional management makes renting easier. A professional property manager, you know, will again do everything beginning to end. They'll market the property, screen for high-quality tenants, handle the move-ins and move-outs, and they'll oversee all of the repairs, manage the tenant relationship. Ensure compliance with Oregon landlord-tenant laws and all of the laws, collect rents and provide statements. And this gives you the financial benefits of holding a rental without the headache of managing it yourself. So if you're considering turning your home into a rental and want to help— want help analyzing the numbers or managing the entire process, we'd love to support you. And thanks for watching.
