Considering Renting Out Your Home Instead of Selling? Here's What You Need to Know First

If your home’s been sitting on the market without any offers you’re happy with, you’re probably starting to ask: What happens if it doesn’t sell? For more and more homeowners, that question is leading to a new possibility — should I just rent it out instead?

In real estate, there’s actually a term for this situation: “accidental landlord.” According to Yahoo Finance, here’s what that means:

“These ‘accidental landlords’ are homeowners who tried to sell but couldn’t fetch the price they wanted — and instead have decided to rent out their homes until conditions improve.”

The Reason This Is Happening More Frequently Lately

These days, more and more homeowners are finding themselves in the role of accidental landlords — and according to Business Insider, here’s why that number is climbing:

“While there have always been accidental landlords . . . an era of middling home sales brought on by a steep rise in borrowing rates — is minting a new wave of reluctant rental owners."

Home sales have slowed, largely because buyers are grappling with today’s affordability challenges. As a result, some listings are sitting longer — growing stale on the market. And for homeowners who aren’t willing to lower their price to attract buyers, renting can start to seem like the next best move.

But before you go down that road, there’s something important to keep in mind: becoming a landlord probably wasn’t part of your original plan — and there’s likely a reason for that. It comes with more responsibility, and more risk, than most people realize.

So, if you’re seriously considering renting your home, make sure to ask yourself these key questions first:

1. Is Your Home a Strong Candidate for Rental Income?

Just because renting is an option doesn’t automatically mean it’s the right one. Consider the following:

• Are you relocating out of state? Managing repairs and tenants from a distance can be challenging and time-consuming.

• Does the home need work before it’s ready to rent? If so, do you have the time, budget, and resources to handle those updates?

• Is your neighborhood attractive to renters — and would your home actually generate a profit?

If any of these questions raise concerns, it might be a sign that selling is still your smarter move.

2. Ready for the Realities of Rental Property Management?

Renting out your home might seem like an easy way to earn passive income — at least on paper. But in practice, it often looks more like this:

• Late-night calls about leaky faucets or broken A/C units

• Following up on missed rent payments

• Handling unexpected damage between tenants

As Redfin puts it:

“Landlords have to fix things like broken pipes, defunct HVAC systems, and structural damage, among other essential repairs. If you don’t have a few thousand dollars on hand to take care of these repairs, you could end up in a bind.”

3. Have You Factored In the True Expenses of Being a Landlord?

Bankrate highlights several hidden costs that come with renting out your home, including:

• Higher insurance premiums (landlord insurance generally costs about 25% more)

• Property management fees (if you hire a manager, they usually charge around 10% of the rent)

• Maintenance expenses and advertising to attract tenants

• Periods without tenants, where you still have to cover the mortgage without rental income

These costs can quickly add up.

While renting can be a smart choice for some homeowners with the right property, if you’re only considering it because your listing hasn’t gained traction, there might be a better option: consult your current agent and reconsider your home’s pricing strategy.

With their guidance, you can adjust your approach, relaunch at a competitive price, and attract serious buyers ready to make an offer.

Key Takeaway

Before committing to renting out your home, take the time to carefully consider the benefits and challenges of becoming a landlord. For many homeowners, the effort—and costs—may outweigh the rewards.