Rent Now, Sell Later

Local housing market stalled? Consider becoming a temporary landlord.

The slump in home prices coupled with the plethora of For Sale signs add up to a double whammy for anyone who has to sell a home. Richard Rogers, an executive with Travelers Insurance, put his home in Overland Park, Kan., in suburban Kansas City, on the market last summer, when he was transferred to Hartford, Conn. The timing could not have been worse: Home sales were ebbing fast, and his $225,000, four-bedroom, two-and-a-half-bath house sat for two months with no bites.

That's when Rogers asked Home Rental Services, a local property-management company, to help him rent the house. Within a few days, the firm had found a doctor who was moving to the city with his family. He signed a two-year lease, with the first year's rent set at $1,700 per month. Rogers is nearly breaking even on his expenses, including his mortgage payment and the commission the management company charges (10% of the rent). When the lease expires, he will try to sell again.

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Patricia Mertz Esswein
Contributing Writer, Kiplinger's Personal Finance
Esswein joined Kiplinger in May 1984 as director of special publications and managing editor of Kiplinger Books. In 2004, she began covering real estate for Kiplinger's Personal Finance, writing about the housing market, buying and selling a home, getting a mortgage, and home improvement. Prior to joining Kiplinger, Esswein wrote and edited for Empire Sports, a monthly magazine covering sports and recreation in upstate New York. She holds a BA degree from Gustavus Adolphus College, in St. Peter, Minn., and an MA in magazine journalism from the S.I. Newhouse School at Syracuse University.