Winter Rental Strategies for Unsold Homes

Interest rates are high, cold weather is upon us, we’re headed into the holiday season and your home hasn’t sold.

You might be thinking, let’s just rent it out for the winter then put it back on the market for sale this spring. At first blush, it makes sense. Get the property generating income and potentially covering the mortgage until you re-list for sale in the spring.

If your home has been on the market for sale and you’re considering renting it over the winter, it’s likely you’ve already moved out and taken all your furniture with you. You’re planning to rent it unfurnished for 3 or 6 months – a mid-term unfurnished rental.

Mid-term unfurnished puts us in a unique niche in the market. Mid-term rentals are longer than a month and less than a year. However, because it’s unfurnished it cuts out some of the common mid-term renters, like traveling nurse or corporate housing. It also cuts out the long-term unfurnished rental market, since they’re looking for a home they can stay in for a year or more.

That’s not to say there’s no market. People moving to town who want to get to know the area before committing to a long-term lease or someone who is building a home and needs a place to live for a few months while it’s being finished may be looking for this kind of property. However, in our experience that market is pretty small.

Think about it from a renter’s standpoint. Remember how long it took you to box up and move out of your home? It’s not the most fun way to spend your time.

For a renter, a mid-term unfurnished home would mean they’re moving in all their furniture and belongings, getting settled, then after only a few months preparing to move back out. Some people, in the right circumstance, may be looking for just that, but it’s probably a small potential renter pool.

Here’s some other options-

Option 1: Short-term Furnished

If your home is furnished one consideration is a short-term rental (think VRBO). In this case, you may rent it for a night or two at a time. A few things to consider if you go this path is booking, cleaning and turning the property between renters. Will you manage the bookings and cleanings, or will you outsource it? DIYing can save money but is also a time commitment. Conversely, if you want to utilize a management company expect to pay a higher rate for short-term management compared to long-term.
You’ll also want to be sure to familiarize yourself with any short-term rental ordnances in your city.

Option 2: Mid-term Furnished

Another alternative to consider is offering the home as a mid-term, furnished rental. This opens the renter pool to a wider array of potential renters compared to mid-term unfurnished, including traveling nurses, people who can ‘work form anywhere’, corporate housing, people who have been displaced from their home due to fire or other catastrophe, and those who are building or remodeling and don’t want to go through the headache of moving all their furniture and belongings. If your home is furnished, a mid-term rental may help get your home occupied with less time commitment and management expense than a short-term rental.

Option 3: Long-term, Unfurnished

If furnishing your home isn’t an option, then you might consider offering it as a long-term lease. An 18-month lease can help get you out of the cold season and into a cadence of lease terms expiring in the summer months. For example, if you lease the home in December 2023, then the term would end during the busier summer months of 2025. At that time, you could determine whether you’d like to extend the lease to the current tenants, put it back on the market for rent during the busier season, or offer it for sale at that time.

Option 4: Stick with Selling

You always have the option to stick with selling it. Probably not what you expected to hear coming from a property management company, but it’s certainly an option to consider.

The Silver Bullet

Ah, if only it was so easy. Having a home sit on the sales market can be stressful. Unfortunately, a mid-term unfurnished rental may not be the silver bullet you had imagined.  Understand your options and take a little time to reflect on what is the best choice for your personal situation.

If you decide that renting your home is the right option, give us a call.

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