Your House Won't Sell. SO You Think You Should Rent It Out Instead... Well Maybe
Your house has been sitting on the market for months. You've already moved into your new home, and now you're making two mortgage payments. Your savings are slowly disappearing, and you're starting to wonder: "Should I just rent the house out?"
It's a question a lot of homeowners are asking themselves, especially when their homes aren't selling as quickly as they expected.
And renting your house out might actually be a great idea.
But it could also turn into a very expensive mistake.
I've been in real estate for over 10 years. I've flipped more than 50 houses, invested in rental properties, and I own a property management company here in Kansas City.
I've seen people make a lot of money with rental properties. I've also seen people get into situations they never expected because they became landlords without really understanding what they were getting into.
So before you take that For Sale sign out of your yard and replace it with a For Rent sign, there are some things you need to think about.
You're Paying Two Mortgages. How Long Can You Keep This Up?
Let's start with the biggest reason people consider renting out a house that isn't selling.
Money.
You bought another house, moved your family, and expected your old house to sell.
Maybe you needed the proceeds from the sale to pay down your new mortgage. Maybe you were planning on putting that money back into savings.
Or maybe you don't necessarily need the money, but making two mortgage payments every month is starting to get uncomfortable.
Let's say your old mortgage is $1,500 a month.
Every month that house sits vacant, another $1,500 comes out of your pocket. And that's before utilities, insurance, maintenance, and everything else that comes with owning a house.
After six months, you've made $9,000 in mortgage payments on a house nobody is living in.
And that's assuming nothing goes wrong.
Now winter is coming. You're worried about pipes freezing, somebody breaking into the property, or something happening while nobody is there to notice.
At some point, you start thinking:
"Why am I paying for this empty house when somebody could be living there and paying me rent?"
That's a reasonable question.
But before you jump into becoming a landlord, you need to understand what you're signing up for.
Congratulations! You're About to Become an Accidental Landlord.
Most real estate investors start with a plan.
They look at properties, run the numbers, evaluate rental demand, and decide whether an investment makes financial sense.
That's not what you're doing.
You bought a house to live in. Now, because it isn't selling, you're considering turning it into an investment property.
That's what I call an accidental landlord.
And there's nothing inherently wrong with that.
In fact, some people end up building substantial real estate portfolios after starting with a house they couldn't sell.
But there's a big difference between intentionally buying a rental property and becoming a landlord because you feel like you're running out of options.
The biggest mistake you can make is assuming that renting the house will automatically solve your financial problems.
It might.
But it could also create an entirely new set of problems.
First, Does Your House Actually Make Sense as a Rental?
Before you worry about finding tenants, let's talk about the numbers.
Just because somebody is willing to rent your house doesn't mean it's a good rental property.
Let's say your mortgage payment, including taxes and insurance, is $1,500 per month.
You do some research and discover your house could rent for $2,000 per month.
<box>
<text weight="medium" size="sm">Example monthly rental numbers</text>
| Item | Amount |
|---|---:|
| Monthly rental income | $2,000 |
| Mortgage, taxes, insurance | -$1,500 |
| **Remaining before other expenses** | **$500** |
</box>
At first glance, that looks pretty good.
You've got a $500 spread between your mortgage payment and your rental income.
But that $500 isn't all profit.
You still have maintenance, repairs, possible vacancies, leasing expenses, and potentially property management fees.
If you hire a property manager, that's another expense you need to account for.
And if your HVAC system goes out and you need to spend $5,000 replacing it, that could wipe out a substantial amount of your cash flow.
That doesn't necessarily make the property a bad investment.
It just means you need to understand the difference between collecting rent and actually making money.
Build a Rainy-Day Fund
One of the things I recommend to rental property owners is setting money aside for unexpected expenses.
If you're bringing in more rent than you're spending each month, don't immediately start treating that extra money as spending money.
Put it into a reserve account.
That way, when the water heater breaks, a tenant moves out, or you have an unexpected repair, you're not reaching into your personal savings to cover it.
The goal is to have the property eventually support itself financially.
And if the numbers don't leave enough room to build those reserves, you need to seriously question whether renting the house makes sense.
Just Because Your House Is Ready to Sell Doesn't Mean It's Ready to Rent
Here's something that surprises a lot of homeowners.
They think because their house was listed for sale, it's automatically ready for tenants.
Not necessarily.
Depending on the condition of the property, you might still need to spend money getting it ready to rent.
Maybe the carpet needs replacing.
Maybe the walls need fresh paint.
Maybe there are some small maintenance items you've been putting off.
Or maybe the house is in excellent condition and doesn't need much at all.
Every property is different.
But here's what I tell owners:
The condition of your property has a direct impact on the type of rental experience you're likely to have.
A clean, well-maintained home with functioning mechanical systems is generally easier to market, easier to maintain, and more attractive to prospective tenants.
If the furnace, air conditioner, plumbing, and appliances are all in good working order, you may go a long time without any significant maintenance issues.
You might just have a few small work orders here and there.
But if you're starting with a house that already has a bunch of deferred maintenance, don't expect those problems to disappear once somebody moves in.
They're probably going to become your problems at the least convenient time.
The Biggest Question: Who Is Going to Manage This Property?
This is probably the most important question you need to answer.
And it's the one a lot of accidental landlords underestimate.
When people first consider renting out their house, they usually think:
"How hard can it be? I'll find somebody to rent it, collect the money every month, and handle repairs when they come up."
And sometimes, that's exactly how it goes.
You find a great tenant. They pay their rent on time. They take care of the property. You have very few maintenance issues.
Life is good.
But what happens when it doesn't go that way?
What happens when the rent is late every month?
What happens when the tenant stops paying altogether?
What happens when they're constantly putting in maintenance requests, and you don't know whether something is actually broken?
Now you're trying to coordinate contractors, collect rent, deal with tenant complaints, and figure out landlord-tenant laws.
And you're doing all of this while working your regular job.
Your Rental Property Just Became Your Second Job
Think about the average family.
Both spouses might be working. They've got children, school activities, sports, family commitments, and everything else that comes with everyday life.
Now throw a rental property into the mix.
It's Saturday afternoon, and you're at your kid's soccer game.
Your tenant calls because the toilet is overflowing.
What are you going to do?
Are you going to leave the game and drive over there?
Are you going to try to find a plumber who can come out on a Saturday?
And how much is that plumber going to charge just to show up?
Now imagine that happening repeatedly.
Maybe it's a plumbing issue this week, an appliance issue next week, and a tenant who hasn't paid rent the following month.
What started as a way to stop making two mortgage payments has suddenly become another job.
And if you're already busy, that job can get expensive—not just financially, but in the amount of time it takes away from your life.
Why Hiring a Property Management Company Might Make Sense
This is where professional property management can make a big difference.
At VP Property Management, we already have systems in place to handle the things that individual landlords often struggle with.
We handle tenant screening, leasing, rent collection, maintenance coordination, tenant communication, and the day-to-day issues that come with managing rental properties.
We also have a maintenance team that can investigate issues before automatically sending out a more expensive outside contractor.
That's important.
Let's say a tenant reports that something isn't working.
If you're managing the property yourself, you might call a contractor who charges you just to show up and diagnose the problem.
But sometimes the issue is relatively simple.
Having a maintenance team that can evaluate what's happening, identify the problem, and determine the appropriate repair can save owners unnecessary service calls.
And when something more serious happens, you've already got people and processes in place to respond.
That doesn't mean you'll never have maintenance expenses.
It means you don't have to personally handle every single problem that comes up.
For somebody who never intended to become a landlord in the first place, that can be a huge benefit.
The Problem With Owning Just One Rental Property
I've talked about this in other videos, but it's worth bringing up again.
One rental property can be surprisingly expensive to own.
Here's why.
When you own one rental property, every unexpected expense comes out of that property's income or your personal finances.
Let's say you're making $300 a month after your regular expenses.
That's $3,600 a year.
Now the air conditioner goes out, and you have to spend $5,000 replacing it.
There goes more than an entire year's cash flow.
Or maybe the tenant moves out, and you have to spend $2,000 getting the property ready for the next person.
Plus, you've got a month without rental income.
When you own one rental property, those expenses can really hurt.
What If You Built a Rental Portfolio Instead?
Now let's look at this from another perspective.
What if, instead of treating this house as a temporary solution, you started looking at it as the beginning of a real estate investment portfolio?
Maybe you keep this house as a rental and eventually purchase another rental property.
Then another.
As your portfolio grows, you're spreading the financial risk across multiple properties.
If one house needs a major repair, you may have cash flow from other properties helping offset that expense.
If one property is vacant, the others might still be producing income.
Of course, owning more properties also means more debt, more maintenance, and more financial responsibility. You need sufficient reserves and good investment numbers before expanding.
But there's a reason real estate investors often work toward building portfolios rather than owning just one rental property.
Multiple well-performing properties can create more financial flexibility.
If you're going to become a landlord, even accidentally, it might be worth thinking about whether this could become a long-term investment strategy.
What If You Want to Sell the House Later?
Here's another thing you need to think about.
Just because you turn your house into a rental doesn't mean you have to keep it forever.
Maybe the market improves.
Maybe property values increase.
Maybe your financial situation changes.
You could decide to sell the property in a year or two.
But having a tenant in place can complicate that process.
You'll need to consider the lease term, showing access, tenant cooperation, and whether the next buyer wants to purchase a rental property or move into the house themselves.
You also need to think about the financial implications.
If the house has been your primary residence, converting it into a rental can affect your taxes, insurance requirements, and potentially your eligibility for certain capital gains tax exclusions when you eventually sell.
For example, the federal home-sale exclusion generally requires meeting ownership and use tests involving two of the five years before the sale, with additional rules and exceptions. Rental use and depreciation can also affect your taxes.
That's something worth discussing with a qualified tax professional before making the decision.
You should also check your mortgage terms, insurance coverage, HOA restrictions, and any local rental licensing or inspection requirements.
The point is simple:
Don't assume you can rent the house today and sell it tomorrow without any complications.
Have a plan.
So, Should You Rent Your House or Lower the Price and Sell It?
This is where I think people need to be careful.
Sometimes renting your house is a great financial decision.
Other times, it's just a way to avoid making a difficult decision about the sale price.
Let's say your house has been sitting on the market for months.
You've already reduced the price once or twice, but you're still not getting offers.
You might be thinking, "I'm not giving this house away. I'll just rent it."
I understand that.
But you need to separate the emotional side of owning the house from the financial side.
Ask yourself:
How much would I need to reduce the price to get the house sold?
How much am I spending every month keeping it vacant?
How much could the property realistically rent for?
What expenses would I have as a landlord?
Can I afford a major repair or an extended vacancy?
Do I actually want to own a rental property for the next several years?
Let's say you could reduce your asking price by $10,000 and sell the house.
Or you could keep making two mortgage payments while trying to find a tenant.
Neither option is automatically better.
You need to compare the actual numbers, including your equity, potential rental cash flow, sale proceeds, and the risks involved.
Sometimes taking a little less money today is better than taking on years of additional responsibility.
Other times, keeping the house as a rental could be one of the best financial decisions you make.
The key is making that decision intentionally—not because you're frustrated that your house hasn't sold.
My Advice to Homeowners Considering Renting Their House
If you've been trying to sell your house and you're now considering turning it into a rental property, here's what I'd recommend.
First, figure out what the property could realistically rent for.
Not what you hope it will rent for. Not what you need it to rent for to cover your mortgage.
What will somebody actually pay to live there?
Second, look at the condition of the property.
Are the mechanical systems in good shape? Is the house clean and ready for a tenant? Are there repairs that need to be made before somebody moves in?
Third, run the numbers.
Account for your mortgage, taxes, insurance, maintenance, vacancy, leasing costs, and property management.
Fourth, decide who's going to manage it.
If you've already got a full-time job, a family, and a busy schedule, ask yourself whether you really want to take on the responsibilities of being a landlord.
Finally, think about the long-term plan.
Are you renting the property for a year while waiting for the market to improve?
Or could this be the beginning of building a rental portfolio?
Those are two very different strategies.
The Bottom Line: Renting Your House Could Be a Great Decision—If You Do It Right
I don't want homeowners to be scared of becoming landlords.
Real estate investing can be a great way to build long-term wealth.
And if you've already got a house with a reasonable mortgage payment, good mechanical systems, and strong rental demand, you might be sitting on a pretty good investment opportunity.
But I also don't want people to think that renting a house is as simple as finding somebody to move in and collecting a check every month.
There's more to it than that.
And the last thing you want is to turn one stressful situation—having a house that won't sell—into another stressful situation involving tenants, repairs, and unpaid rent.
Before you become an accidental landlord, make sure you understand the numbers, the responsibilities, and the long-term plan.
Thinking About Renting Out Your Kansas City Home?
At VP Property Management, we work with rental property owners throughout the Kansas City metro, including Overland Park, Prairie Village, Mission, Shawnee, Lenexa, Lee's Summit, and surrounding communities.
If your house isn't selling and you're wondering whether renting it out makes sense, we'd be happy to help you evaluate the property.
We can discuss realistic rental pricing, the condition of the home, what it might take to get it ready for tenants, and what professional management would look like.
Even if you ultimately decide selling is the better option, you'll have a clearer understanding of your choices.
Get a free rental analysis: VP Property Management
