SHOULD YOU SELL OR RENT YOUR 1 FAMILY HOME IN QUEENS, NY?
Absentee Landord´s considerations. Hello, my name is Manuel Vargas with Xzeller Realty in Queens, New York. And I have 32 years of experience in the real estate market in Queens. And today, I’m going to answer one of the most common questions, I get from home owners. Should I sell or rent my one family and primary residence in Queens, New York?
DISCLAIMER: First, let me give you a disclaimer. All the information that you are about to hear is a product of my experience of 32 years in the Queens real estate market and also my education. I do have a bachelor of science in real estate from NYU Magna Cum Laude and that’s all expertise and education and experience that I’m going to share with you, for your benefit.
So let’s get into our subject matter. What is better to sell or to rent one family home in Queens, New York? Okay, there are five major considerations that will help you decide what is better for you as the owner if whether to sell it or rent it:
1. Tax implications
2. Absentee landlord management implications
3. Selling a house in the future that is rented vs. a home owner occupied house.
4. Opportunity Cost.
5. Personal Reasons.
Here We will talk about #2: What is better for you whether selling your personal residence or renting it becoming an Absentee Landlord?
There could be major implications, especially here in Queens where we are part of New York City and New York City has a lot of regulations for landlords and the fact that New York City is especially demanding on landlords, right?
To begin with. For Private Dwellings (1–2 family homes): You must register a 1- or 2-family home if neither the owner nor an immediate family member lives at the property (making you an absentee landlord). Owner-occupied 1- and 2-family homes are generally exempt.
Then you must be aware of the many other regulations that apply regarding Lead Based Paint, Snow Removal, Bed Bugs, Recycling. In other words, things that you do automatically now and that you may not do if you move out.
Some other important considerations:
· How much rental profit will you make at the end of the day and will that compensate for possible capital gains taxes that you could pay on the sale of an investment property vs. a personal residence?
· Is your property free and clear or do you have a mortgage and how much is your mortgage payment compared to the rent you plan to collect?
· Are you going to stay local so you can keep an eye on the property? How far are you moving.
· Are you handy and are repairs easy for you to tackle on your own?
· Do you have a relative or a local handyman that can do the repairs and maybe help you manage the property?
· Keep in mind many reputable management companies in NYC do not manage small residential mainly because of the liability exposure. You must do It yourself or deal with a private individual, a relative, handyman or super.
In conclusion, all these things matter when deciding to rent your property and many situations that are easy to handle when you live at the property may become an urgent or stressful problem. For example, you may be ok with waiting 1 or 2 days without having hot water while you get a new hot water heater installed, but you may feel stressed that your tenant has to wait those 1 or 2 days. And so on. Being an absentee landlord could be relatively lucrative but it could be a hassle as things quite never work the same way when you live at the property than when someone else lives there. Something to consider…