There are many reasons why homeowners may choose to rent their Napa Valley real estate. It could be that they have to relocate for some time due to work commitments, but plan to return to their home at some point. Others may have wine country real estate as an investment property. Whatever the reason may be, there are benefits to renting your home that over time could beef up your wallet.
If you’re looking into adding another property to your assets, the opportunity to rent it out to cover expenses and generate income is probably on your mind. Many owners have great success in doing so, but it’s important to cross your t’s and dot your i’s before signing the contract.
Make sure that local bylaws and zoning allows you to rent out the wine country real estate you’re purchasing. Also, finding the right tenants is important. Ask for credit checks, background checks, proof of employment, and references.
One mistake some investment property owners make is not factoring in all of the expenses involved. Your mortgage is one key area that rental income can help with, but not the only area. Be sure to consider expenses like taxes, home insurance, utilities, repairs, vacancy, and HOAs. In some cases the market won’t allow you to set a price that covers every one of these factors, so always ensure that you’re in a position to make up the difference.
With the right real estate agents on board, selling Napa Valley real estate typically generates a higher return on investment than renting would. Some homeowners have seen ROIs as high as $100K, which is far more than what they would have made in a year if their monthly rent profits were in the neighborhood of $1000. Sellers also pay fewer taxes as these types of benefits only apply to the principal residence
Whether you decide to rent a property or sell it, take the time to weigh out the pros and cons of each and how they relate to you. At the end of the day, the needs of one homeowner can differ greatly from another, so make the best choice possible for your situation and finances. And if you have any questions or concerns about the rental and buying/selling market in Napa Valley, don’t hesitate to contact St Helena Real Estate today!