You've accepted a job in another city, but your Franklin home is still on the market. Or maybe you found the perfect new house before your current one sold, and now you're carrying two mortgages. Whatever brought you here, you're facing a question many Franklin homeowners encounter: should you rent out your house temporarily instead of selling?
This situation is more common than you might think, especially in Franklin's dynamic job market where corporate relocations happen frequently. The decision isn't just financial—it affects your taxes, your timeline, and your stress level for months or even years to come.
When you're thinking about renting your house temporarily, the math might seem straightforward: mortgage payment minus rental income equals your monthly cost. But that calculation misses several important expenses.
Your homeowner's insurance will likely need to change to a landlord policy, which typically costs 15-25% more. You'll need to consider vacancy periods—even good properties in desirable Franklin neighborhoods can sit empty for a month or two between tenants. Maintenance requests don't wait for convenient timing, and handling them from another state adds complexity and often cost.
Property management fees in Franklin typically run 8-12% of monthly rent, which might seem steep until you're dealing with a tenant emergency while you're trying to settle into your new city. Many people underestimate how much time rental property management actually takes, even with professional help.
Converting your primary residence to a rental property triggers several tax considerations that catch many people off guard. You can no longer claim certain tax benefits associated with your primary residence, and you'll need to start depreciating the property—which affects your taxes when you eventually sell.
If you rent the property for more than 14 days in a tax year, all rental income becomes taxable. You can deduct eligible expenses like maintenance, property management fees, and depreciation, but you'll need to keep detailed records of everything.
The timing of when you sell also matters for capital gains purposes. If you sell within three years of moving out, you might still qualify for the primary residence capital gains exclusion. Wait longer, and you'll likely owe capital gains taxes on any profit.
Franklin's rental market has distinct seasonal patterns. The strongest rental demand typically occurs from March through August, when families prefer to move during the school break and before the new academic year. If you're making this decision in late fall or winter, you might face a longer vacancy period initially.
Consider your property's appeal to Franklin's rental demographics. Families often prefer neighborhoods with good school zones like Williamson County Schools, while young professionals might prioritize proximity to downtown Franklin or easy access to Nashville. Properties near major employers or with easy commute access tend to rent more quickly.
Your house's condition and features matter more in the rental market than you might expect. Tenants often prioritize practical considerations—sufficient parking, functional appliances, adequate storage—over the decorative updates that matter to buyers.
Renting temporarily works best when you have specific circumstances aligning in your favor. If you're confident you'll return to Franklin within a few years, if your mortgage payment is significantly below market rent, or if you're in a particularly desirable neighborhood with strong rental demand, the numbers might work.
It also makes sense when selling would mean taking a significant loss and you have reason to believe Franklin's market will improve. Some people choose to rent when they're emotionally not ready to sell, though this alone isn't usually a sound financial reason.
Renting probably doesn't make sense if you're stretched thin financially and can't handle unexpected expenses or vacancy periods. It's also risky if you have no experience with tenant relations and property management, or if you're moving somewhere that demands all your attention and energy.
Before you make this decision, consider whether you're prepared to be a landlord from a distance. Do you have reliable local contacts for maintenance issues? Are you comfortable dealing with tenant screening, lease agreements, and potential conflicts?
Think about your timeline realistically. Many people tell themselves they'll rent for "just a year or two," but tenant situations, market conditions, or personal circumstances often extend that timeline. Are you prepared for this to become a longer-term commitment?
Consider your risk tolerance. Rental properties can provide steady income, but they can also create headaches, unexpected expenses, and tax complications. If you prefer simplicity and want to focus entirely on your new situation, selling might be worth the financial cost.
If you decide to rent, treat it like the business decision it is. Set aside reserves for maintenance and vacancy periods. Establish relationships with reliable local contractors and property management professionals before you need them. Understand Tennessee's landlord-tenant laws and Franklin's rental regulations.
Price your rental competitively based on current market conditions, not on what you need to cover your mortgage. Overpricing leads to longer vacancy periods that often cost more than pricing appropriately from the start.
The choice between selling and renting your Franklin home depends on your specific financial situation, timeline, and tolerance for complexity. Neither option is universally right or wrong—it's about which one fits better with your circumstances and goals.
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At Redbird Real Estate, we specialize in residential sales, property management, and commercial real estate services in and around Franklin,...
Franklin, Tennessee
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