Selling your home is not always as easy as you think. It can be hard to wait and rely on the perfect housing market conditions to put your home up for sale, and it can feel even worse when you can’t get the offers you want.
Between continuously reducing the price and keeping your property on the market for weeks, you may be discouraged from selling your home at all. Fortunately, there is a solution for Orlando property management and homeowners in general. Renting your home is a great way to source revenue because you would be owning an income producing property.Â
So, before we delve into the details of all the benefits that accompany renting your Orlando property, we should discuss some background information about the current market conditions and future predictions. Let’s dive right in.Â
The Conditions of the Orlando Real Estate Market in 2023 (So Far)
While it is still early in the year to determine the state of 2023 housing market conditions, there are some important items to take into account when determining whether you would like to sell or rent your home.
As you probably know, home prices have been increasing significantly nationwide for years now, and Florida has been known to have some of the strongest housing appreciation rates in the country. Although you might be trying to catch an all-time-high sales price in these market conditions, you might be struggling to get some bites.
So, here are a few important things to take into consideration if you are looking to sell or your home is stuck on the market.
Local Listings
The local supply of homes in the city is a great indication of how easy the process will be for you to sell your home. As of January 2023, the Orlando Regional Realtor® Association stated that overall Orlando property sales fell 24.9% from December 2022, and this is the lowest number of monthly home sales since 2009.
The amount of homes listed on the market rose from 2,186 in December to 2,911 in January, which is a 33% increase in one month. With rising inventory, it may be hard to sell your home for the price you want.
Interest Rates
While interest rates are remaining relatively steady at 6.1%, they rose 81.5% from January 2022. The Orlando Regional Realtor® Association also mentions that the housing market in the city has been gradually slowing down for the past year because the market is balancing itself out.
Economic Conditions
In the summer of 2022, the United States experienced the highest record of inflation in over four decades. Now, 2023 is showing signs of slowing inflation. Although this is promising news for those looking to buy, it is not as beneficial for those looking to sell their homes.
In addition, economists are predicting a recession in the early months of 2023, which most likely means that people will be less inclined to purchase homes.Â
That being said, now we will discuss how renting your home can be a great alternative to selling for a number of reasons.
The 5 Advantages of Renting Out Your Orlando Property
There are almost no negatives when it comes to deciding to put your home up for rent. More and more people are reaping the benefits of investing in long term rental properties. So, here are the 5 main advantages of owning a rental home in Orlando.
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Equity Growth and Appreciation
To simplify equity growth, the longer you have been paying your mortgage, the more equity you acquire for your property. When you have a renter for an extended amount of time, they will be contributing significantly to your mortgage payments.Â
Since Central Florida is becoming such a hotspot for new residents, there are plenty of potential renters who are willing to pay high prices for a rental. Plus, with an experienced Orlando property management company, you can gain equity and appreciation on autopilot.Â
2. Long-Term Profit
With responsible tenants who take care of the property and consistently pay monthly rent, you will receive an influx of revenue each month. While there are plenty of factors that can contribute to the quality of your long-term profit, such as the quality and financial stability of the renters, you can take extra precautions to ensure that you have dependable tenants.Â
The right property management company will conduct background checks and credit evaluations to guarantee that your tenants will be suitable and a helpful source of long-term profit.
3. Rising Rental Rates
An influx of new residents in the area means that the number of available rental properties will decrease, thus creating higher rental prices. For investors and landlords, this is fantastic news because as the demand for rental homes increases, you will be able to rent their property for top dollar.Â
This also means that you will be able to increase the rental rate for each renewal, which provides you a higher monthly profit.
4. Tax Benefits
Although you may be hesitant to rent your property out because you don’t want to pay the taxes on it, the right real estate asset is the perfect tax shelter. By claiming deductions, you can offset your rental income and experience the benefits of lower taxes.
You can rewrite off expenses of the property, including…
- Property taxes
- Maintenance repairs
- Utilities
- Mortgage interest
- Property insurance
- Management fees
- Real estate depreciationÂ
5. Retirement Planning
Even if retirement is not currently on your mind, you will thank yourself in the long run for taking advantage of the opportunities to save up for your retirement. Owning a rental property in Orlando is a great way to compel yourself into investing in the property and the future o
f its profits.Â
In addition to your IRA or 401K, owning a rental property can be a substantial source of your retirement savings, and plus you will have higher returns as time goes on.Â
So, now that you know some of the main benefits o
f owning a rental property, you can begin the process of turning your home into an income-producing real estate asset.
How to Start Renting Out Your Orlando Property
If you are not sure how to begin the rental process, it is highly recommended to consult an experienced property management company. With Metropolitan Real Estate Solutions, you can rest easy knowing we take care of every step of the process.
From marketing, qualifying potential renters, arranging repairs, collecting rent payments, tax documents, and more— We do it all. By using the latest technology, we make sure your property is taken care of. So, choose to rent your Orlando property with an experienced Orlando property management company!