Rent vs Sell Calculator
Rent vs Sell Calculator Results
Financial Impact Of Renting Property
Total Cash Flow + Equity
Financial Impact Of Selling Property
Invested Sale Proceeds
If You Rent The Property - Full Results
| Year | Total Cash Flow + Equity | Annual Rental Income | Annual Mortgage Costs | Property Management Fee | Property Maintenance | Tax On Rental Income | Net Cash Flow | Home Value | Home Equity | Mortgage Balance | Mortgage Principal Paid |
|---|
If You Sell The Property - Full Results
Property Sale Details
Invested Sale Proceeds
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Fund Your Investment Property With New Silver
Fix & Flip
Funds for purchase + rehab or refinance + rehab
Get up to $5,000,000
Interest rate 9.5 - 11.25%
Origination 1.25 - 1.75%
Up to 100% construction
Rent
30 year fixed product for stabilized properties
Get up to $3,000,000
Interest rate from 6.125%
Origination 1 - 2%
30-year fixed rate
Ground Up
Construction loans for residential builders
Get up to $5,000,000
Interest rate 9.75 - 11.5%
Origination 1.5 - 2%
Up to 18 months
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How This Rent vs Sell Calculator Can Help You Decide
This Rent vs Sell Calculator can serve as powerful tool when trying to decide between selling or renting out a property. It evaluates factors like market value, rental income, and appreciation rates, together with the potential profits you could generating by selling the property.
Simply input your property details into the calculator, and it will provide a detailed breakdown of potential outcomes, helping you determine the best option based on your goals.
Pros and Cons of Renting Your Property
Pros of Renting
- Steady Streat Of Passive Income
Renting your property can provide a consistent monthly income, which can be particularly beneficial if you’re looking for a steady cash flow. This income can help cover the mortgage, property taxes, and maintenance expenses. - Property Value Appreciation
By holding onto your property, you allow time for it to potentially appreciate in value. Over the years, this can result in big gains in equity and generate a substantial profit if you decide to sell later. - Tax Benefits
Landlords can often claim deductions for property-related expenses, such as mortgage interest, property taxes, insurance, and repairs. This can reduce your overall tax burden. - You Can Retain An Asset And Build Up Equity Over Time
Renting allows you to keep the property as a long-term asset, which can be used for future financial needs or as an inheritance for your family. For instance, if you build up enough equity in the property, you could then use that equity to fund the purchase of an additional rental property. This approach introduces the possibility of expanding your rental property portfolio over time.
Cons of Renting
- Property Management Responsibilities
Being a landlord comes with a number of responsibilities, including finding tenants, collecting rent, and handling maintenance issues. If you’re not prepared for these tasks, it can be stressful and time-consuming. - Risk Of Bad Tenants
Not all tenants are reliable. Late payments, property damage, or disputes can arise, leading to potential financial and legal headaches. - Vacancy Periods
If the property is vacant for extended periods, you may have to cover expenses without rental income, which can strain your finances. Vacancy rate is typically treated as an annual expense, when calculating the long term profitability of a rental property. - Market Fluctuations
Rental income depends on market demand, and downturns in the local rental market can lead to reduced income or difficulty finding tenants.
Pros and Cons of Selling Your Property
Pros of Selling
- Immediate Financial Return
Selling provides a lump sum of cash that you can use for other investments, debt repayment, or personal needs. - Elimination of Property Management
Once the property is sold, you’re no longer responsible for maintenance, taxes, or other ownership costs. - Favorable Market Conditions
If property values are high, selling can yield a significant profit, especially if your property has appreciated over time. - Reduced Risk Exposure
Selling eliminates risks associated with property ownership, such as market downturns, tenant issues, or unexpected repair costs.
Cons of Selling
1 – Loss of Future Appreciation
By selling, you forfeit any potential future increases in property value. If the market continues to rise, you might miss out on additional profits.
2 – Transaction Costs And Capital Gains Tax
Selling involves costs such as agent commissions, closing fees, and potential capital gains taxes, which can eat into your profits.
3 – Emotional Attachment
For many homeowners, selling can be emotionally difficult, especially if the property holds sentimental value.
4 – Market Timing Risks
If market conditions are unfavorable, selling might result in a lower return than expected.
5 -Losing Out on Leverage:
One major drawback of selling is losing the ability to leverage your property as a rental asset. Real estate is one of the few investments that allow you to use other people’s money (through financing) to build wealth over time. By holding onto the property and renting it out, you can generate income while the property appreciates in value, often with the help of a tenant covering part or all of your mortgage payments.
Selling the property means forfeiting this opportunity to benefit from both cash flow and long-term appreciation, reducing your potential to build wealth through leveraging real estate. For investors seeking to grow their portfolio, this can be a missed opportunity to maximize returns with minimal upfront capital.
6 – Unreliable Returns From Reinvestment:
When you sell a property, you might plan to reinvest the capital into other ventures such as stocks, mutual funds, or even another business. However, these investments often come with higher levels of volatility and risk compared to real estate.
Additional Resources & Calculators
Workout the potential profitability of an investment property with our Rental Property Calculator.
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