Selling Rental Property in South Tampa

Posted on: July 12th, 2017 by , 58 Comments

Selling Rental Property in South Tampa

Selling rental property in today’s market can be complicated. Knowing when to sell your rental property is just one of many questions you might have. Even though asking prices are breaking record highs, selling your home is a daunting task for most homeowners.

Listing, updating, and advertising your home costs both time and money. But what about the added pains to selling an income property? Believe it or not, selling a rental property in South Tampa doesn’t have to be a months-long nightmare.

Sell Rental Property to a Builder

Selling Rental Property: The Right Time

Like most ventures, selling rental property in South Tampa is all about timing.

Determining the right time to sell your rental property means considering a multitude of factors. Selling a South Tampa house is not only more complicated than purchasing, it also requires more risk. According to some experienced in home-selling, “choosing the right time to sell a rental property may be more crucial to your success… then your initial decision to purchase it.” With that in mind, consider these factors when selling rental property in South Tampa.

Before selling, evaluate the current state of your rental. Rental properties are notorious for being hard to manage, even with an attentive and well-meaning landlord or property manager. Whether it’s a lack of cooperative tenants or the inability to foresee the emergence of major repairs, a rental property can fall into a state of disrepair fast. Needing major repairs without having access to the home or funds set aside for them can create a massive financial loss that’s unappealing to most rental property owners. It may be time to sell.

office table with white chair and wooden floors. Selling Rental Property in South Tampa,FL

Does your property generate a negative cash flow? Does it cost more to own and maintain than the income it produces? Even rental properties with the highest rent in the best neighborhood can be too costly to keep.

Owning the ideal rental property in South Tampa means paying for property upkeep, county taxes, utilities, insurance, among other monthly expenses. Your renters are paying for residence in the best area, but you’re paying more for maintenance and management. After expenses, is the bottom number adequate, or can you yield more revenue in other investment opportunities?

Like most markets, the renter’s market is fickle. A good year for rental property owners can mean increased appreciation and profit. But a market downturn can hemorrhage your savings. A once profitable piece of property can become an anxiety-inducing nightmare. Consider your long and short-term goals. If you envision your investment as more of a financial liability than a guarantee, it’s time to consider selling a rental property in South Tampa.

Selling with a Tenant

So you’ve decided to cut your losses and sell your rental property. Now, what? If you have current tenants, you might be wondering about the complications concerning selling your rental property with tenants.

Rooftops selling rental property

Even if your tenant is one of those rare, dream tenants – they’re tidy, never call after hours, and care for your property like it’s their own – selling your rental with a pre-existing tenant is more of a hassle than selling an empty home. “If you want to sell your house with a tenant for the highest and best price, even the best tenant can be a detriment,” warns Realtor Bill Petrey. This is partly due to a tenant’s lack of incentive to keep the property in showroom condition to impress and woo home buyers.

Having a tenant is also a deterrent for many potential buyers. Like it or not, when you’re selling rental property with tenants you’re selling rental property with a tenant’s lease. You reduce the pool of potential buyers. Some home buyers can wait until a tenant’s lease is expired to move, and will buy your property without worry. But most want homes that are move-in ready the day of closing. Unless you’re trying to attract landlord buyers and other investors, selling a home with a pre-existing tenant can be limiting.

But there’s an upside to selling rental property with tenants. You can combat the negatives by enlisting your tenant’s help with showing your property to potential buyers!

By communicating with your tenant, you gain the possibility of making them more amenable to showing your home, an inconvenience no one likes during the selling process.

Some rental property owners even offer tenants a reward for keeping the home in peak condition. These rewards can include lowering their monthly rent or giving them gift cards to spend the day of a showing. “The success of dealing with a tenant during a sale is less about the message itself, but in how the message is delivered,” explains Zillow’s Brendon Desimone.

Selling tenant-occupied property can be tricky, but it’s certainly not impossible. While some buyers avoid tenants, others flock to the chance at owning a rental property that produces consistent income day of sale. If you can offer your tenant an incentive for the inconvenience of showing your property and helping with the upkeep, you’ll generate more potential buyers. More buyers mean more bidding, and more bidding means procuring top dollar when selling a rental property in South Tampa.

selling rental property old house

Selling at a Loss

When selling a rental property, it’s smart to consider the taxes imposed on your capital investment. It might be the least of your worries, but you must pay tax on any profit you earn while investing. It’s your selling rental property taxes.

If you’re selling while the market is favorable, your overall equity has increased, or you’ve lacked any major vacancies since renting your property, expect to pay a capital gains tax. The tax signifies your rental property’s ability to earn a positive cash flow and is considered a positive consequence of selling.

But what about selling rental property at a loss? Although very few investors buy property to lose money, it happens quite often. It’s one of the major risks of real estate. It can happen for any number of reasons, including a property-specific problem or the market losing equity.

Selling at a loss means the property drops in value causing you to lose money when selling. No one wants to sell at a loss, but sometimes it’s inevitable. It doesn’t have to be a negative consequence of selling, though.

According to Turbo Tax, “losses from selling rental properties generally receive favorable tax treatment.” If you owned your property more than a year, you can file for a Section 1231 loss. This specific loss can be used to reduce any type of positive income you’ve accrued. If your Section 1231 loss is large enough and it reduces all other income below zero, you obtain a Net Operating Loss (NOL). While taking a huge financial loss is generally considered bad, it can be a blessing for tax purposes. An NOL can be carried back for at least two years, offsetting taxable income and allowing you to regain the taxes you paid those previous years. An NOL can also be applied to future tax years and counter net gains for up to twenty years!

Selling rental property at a loss is a short-term loss, but it offers long term gain. If you purchased your rental property with a mortgage, you’re able to pay off your mortgage with a short-sale, even with an overall loss. If you own the property outright, you can take the loss but garner great tax benefits that last well after your close. Selling rental property at a loss isn’t only a viable solution to selling your investment, but can be a strong business plan to invest in future properties.

Selling rental property in South Tampa, FL doesn’t have to be stressful when considering all the factors before closing. Is it the right time to sell? Do you need to sell with tenants? Will those tenants need to be evicted? What are the tax benefits to selling? If you can answer these questions with assurance, selling your rental can be an easy decision with multiple benefits.

Get a Cash Offer For Your Rental Property in South Tampa

Interested in a faster option? South Tampa Teardown can get you a no-obligation, cash offer from a builder to buy your rental property in South Tampa.

My name is Rob Wilson, I’m the Director of Dirt with South Tampa Teardowns and EXIT Bayshore Realty. If you’re worried about selling your house with a tenant, we have buyers who will close fast and give your renter time to move out if needed. We can also take care of evictions or purchase properties with extensive damage. If you want to find out more, do not hesitate to call me directly at 813-784-4199. I looking forward to talking with you.

58 Responses

  1. […] covered the stress of eviction and other issues regarding selling a rental property in a previous blog […]

  2. […] you may be able to realize a capital gain of up to $250,000 or $500,000 TAX FREE. If you are selling a rental property in South Tampa, you may be able to defer capital gains taxes by using a 1031 […]

  3. Pretty nice post. I just stumbled upon your blog and wanted to say that I have truly enjoyed browsing your blog posts. In any case I’ll be subscribing to your feed and I hope you write again very soon!|

  4. I simply couldn’t leave your web site before suggesting that I actually loved the usual info an individual supply on your guests? Is gonna be again ceaselessly to check up on new posts|

  5. Estherfequef says:

    Gxqyow ahskne canadian pharmacy online canada online pharmacy

  6. Estherfeque says:

    Vsymtl fpsqvv best online pharmacy canada online pharmacy

  7. Estherfeque says:

    Brcemh lvuazw Buy viagra Buy pfizer viagra in canada

  8. Estherfeque says:

    Pttiuu ervvfg Buy viagra Real viagra without prescription

  9. Estherfeque says:

    Zkxjll wfvtje Canadian viagra 50mg Buy pfizer viagra in canada

  10. Estherfeque says:

    Vswjix tccopm Cialis online ordering canada online pharmacy

  11. Estherfeque says:

    Snzspw eogltq cialis generic canada pharmacy

  12. Estherfeque says:

    Gpxhmy jhzfuq Buy cialis in us walmart pharmacy

  13. g at says:

    I don’t know if it’s just me or if perhaps everyone else encountering problems with your site.
    It looks like some of the written text in your posts are running off the screen. Can someone else please provide
    feedback and let me know if this is happening to them as well?
    This could be a issue with my web browser because I’ve had this happen before.


  14. g our says:

    Hi! This is my first visit to your blog! We are a group
    of volunteers and starting a new project in a community in the same niche.
    Your blog provided us beneficial information to work on. You have
    done a extraordinary job!

  15. Umxkav dfcznq kamagra pas cher mens erection pills

  16. Do you have a spam issue on this site; I also am
    a blogger, and I was wanting to know your situation; many
    of us have developed some nice practices and we are looking
    to swap strategies with other folks, why not shoot me an email
    if interested.

  17. Iqofif pysicc levitra 20mg canadian pharmacy

  18. Fnmjpf tvudth online casino games for real money online casino real money paypal

  19. Hywoie dwydpq online viagra prescription erectile dysfunction medicines

  20. Its such as you learn my mind! You appear to understand so much approximately this, such as you wrote the ebook in it
    or something. I think that you just can do with a few p.c.
    to pressure the message house a bit, but instead of that,
    that is fantastic blog. A fantastic read. I’ll certainly
    be back.

  21. Spfyib yccthb viagra prices erection pills that work

  22. Yes! Finally something about cbd oil that works 2020.

  23. Howdy, i read your blog occasionally and i own a similar one and
    i was just curious if you get a lot of spam remarks? If so how do you prevent it, any plugin or anything
    you can recommend? I get so much lately it’s driving me crazy so any help is
    very much appreciated.

  24. Hey there! This is my first comment here so I just wanted to
    give a quick shout out and say I genuinely enjoy reading through your articles.
    Can you suggest any other blogs/websites/forums that deal with
    the same subjects? Thank you!

  25. Evihiv lvlwoy viagra online usa Alternative for viagra

  26. Gphepc sjauxh best online casino online casino real money no deposit

  27. Viagra brand says:

    Qnomhc dfcgjn cash advance parx casino online

  28. Viagra jelly says:

    Sqisub hvgyzl online loans win real money online casino for free

  29. Exjhde xqiwvk lasix 100 mg furosemida 40 mg

  30. Ltghht elsqec lasix uses lasix 100 mg tablet

  31. cialis buy says:

    Zfkwve nasrqz lasix online lasix for sale

  32. cialis 20 mg says:

    Mpvrzz qijqgg buy clomid clomiphene online