Homeowners Become Reluctant Landlords

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In this sagging economy, homes can sit on the market for weeks or months. So, would-be sellers often move on, and instead of handing the keys over to new owners, they hand them to tenants. Sometimes that goes well — sometimes not.

“This is the new reality,” says Chicago Realtor Frank Maguire. “Our market is, you might sell your home or you might not. There’s a whole world of people who are unintentional landlords.”

Unintentional, accidental, reluctant, never-in-the-world-thought-they-would-be-a-landlord landlords. That’s the fate of many a homebuyer trying to sell these days.  Sometimes it works out well. Maguire’s next-door neighbor, Paul Williams, is a good example of this trend. Williams, along with his wife and young daughters, rent a home in Rogers Park on Chicago’s far north side. A job change brought them to the area.

They also own a two-bedroom bungalow in Oakland, Calif., that they bought at the height of the housing boom.

“We bought it at just over $500,000,” Williams says, “and the last appraisal was at $260,000.”  Once they heard that appraisal, Williams says, he and his wife decided not to sell but instead to rent their home to a friend of a friend.  “I’d owned rental property before and had almost a problem every month, and so was not very excited about the idea of becoming a landlord again,” he says. “But we’ve been very fortunate to have a great tenant, knock on wood. Thus far it’s been very uneventful.”

There has been a big jump in the number of single family homes shifting into the rental market since the country’s housing boom started to bust.

Read more about it at NPR.org

Commentary from Bob Karp of Karp Properties LLC:  Many homeowners in the Sierra Vista, Hereford Arizona area have been faced with challenge of what to do when they cannot sell their property and must relocate due to a military or job posting.  Renting your property is certainly a solution, but there are many issues with handling it yourself.  If you are in the city of Sierra Vista, you must collect and pay a 1% rental tax.  How will you handle repairs or collecting rents if you are not in the area?  Using a licensed property manager may be a solution.  Contact our office for more information on professional property management services including costs and benefits.