Better to sell your house or rent out your house

Here you can find some helps on deciding to rent out or sell your house in The Netherlands

To figure out if renting out your house in The Netherlands is a better option than selling your house depends on your situation. Since both options have pros and cons, we have made a list on how to choose which path is the best for you.

Is selling your house worth it?

First of all you need to know your home value. You can do this by means of an appraiser or you can use an online estimate tool for an approximation on your house.

1. Compare your home value to the local home value

When you have an approximation on your home value you can conduct a market analysis to compare your house to the local standar. You can do this simply by searching for the average home value (Gemiddelde woz-waarde). The website weetmeer.nl contains the average home value per city and even has a lot more information on characteristics of a specific city.

2. Calculate the profit you make on selling your house

Selling your house costs money upfront. However you can make money on selling your house, especially if the housing market is healthy. Also a real estate agent can make a difference on the amount of money you are selling your house for.

• Firstly you need to calculate how much you will spend on preparation, cleaning, fees, property taxes, transfer taxes, real estate agent etc.
• Conduct a calculation on how much you have to pay off your mortgage yet.
• Know how much your down payment was when you bought the house.

When you add all those costs and then subtract the projected sale price you received from the appraiser or online estimator, you end up with the amount of money you make or lose. When you make money on selling your house, it is probably a good call to place your house on the market. You have to take into account that there is a selling timeframe. So only do this if this time is achievable.

In short;

In the case that you can get a fair market value in an acceptable time frame then it is a good choice to sell your house. Analyse house market in your area to be healthy. The market is considered healthy when houses are being sold for the home value or above.

If you don’t meet these criteria, renting out your house can be a better option.

Is renting out your house in The Netherlands an option for you?

We have made a list on deciding if renting out is a good option.

1. Search for the vacancy rate for rentals in your area.

It is important to know how often your home would sit without a tenant. Because if your current tenant vacates, you won’t make any money and end up with al the costs. Being prepared for this situation is key.

2. Figure out a reasonable rental price.

This can be done by comparing rental prices in your area with the same type of home. You want an attractive price, but also make profit on it. By checking the renting prices in your region, you will get a good idea what is acceptable for your type of house.

3. Take the costs in accounting

Renting out your home leads to unexpected charges that can incur. Because of the tenants your house will wear and tear along the way. Some problems your tenants would run into concerning the house, is something you must pay for. These costs can add up and maybe a bigger renovation, for instance a roof fix, is around the corner. However you’ll have the right to claim certain tax reduces.

4. Calculate how much you will make a year

To know how much your profit will be, each take the amount of rental income and subtract the expected vacancies, repair costs, HOA fees, taxes and the mortgage payment. You should at least break even, but a profit under €1.200 is considered to be low. You might want to reconsider your options. Because of the maintenance you are still accountable for can be higher some year than the other.

In the end, it depends on the numbers and your personal preference

If you have completed the lists you will have a good insight if renting out or selling is a better option. If you can sell your house for a profitable price within your time frame it probably is a good choice to sell. However, if the house market isn’t healthy and you can’t get a reasonable selling price, renting out isn’t a bad choice either. You also still have the possibility to move back to your house in The Netherlands when you are renting.