Should You Sell or Rent Your San Diego Home? Expert Property Management Tips

Should you sell or rent your home? This is a common question that comes up.

Renting Considerations – Appreciation Potential

First, consider renting the property. The most important thing you need to think about when you’re renting out a property is whether there is any potential for appreciation. If that home is not going to appreciate, there is no sense in keeping it. Make sure there’s a reasonable chance the property will appreciate in the next 5 to 10 years. Maybe you will want to sell it in 10 years. You’ll need to have some idea of what it will be worth, and what you’ll have to pay in taxes when you do sell.

Renting Considerations – Cash Flow

The second issue to consider if you want to rent out your property is whether your rental income will equal your rental expenses. If it doesn’t, you’ll experience negative cash flow. Factor that in over the 10 years that you plan to hold onto the property. You need to figure out what the home will be worth and whether the cash flow or negative cash flow makes sense.

Selling Considerations – Exclusions

If you decide to sell your property, you have a different set of considerations. If the home you’re selling is your primary residence, remember that if you lived in it for two of the last five years, you can take advantage of exclusions. If you’re single, that’s a $250,000 exclusion, and if you’re married, it’s $500,000. This is important because if you decide to hold onto the property and rent it out for 10 years, you will lose that exclusion.

Selling Considerations – Proceeds   

You’ll also need to think about what you plan to use the money for when you sell. If you are going to need those proceeds for another residence, you’ll need to factor that into your decision as well.  

On the rental side, think about the potential for appreciation and whether the cash flow is negative or positive. If you sell it, understand your taxes and think about what you’re trying to accomplish.

If you have questions about property management in San Diego, or you need help making this decision, please contact us at Mercer Properties. We’d be happy to help you weigh your options.

Craig V. Castanos is a Certified Financial Planner and Certified Public Accountant located in San Diego, CA. He can be reached at 619.235.2131 or