Renting out the house you can’t afford…

The housing market, at least in the US, is a bit topsy turvy. It’s a buyer’s market, with plenty of people hoping to get out from underneath their own house and upgrade to something that will fit their expanding family. Take my friend KT for example: she is in the process of doing that very thing. She’s in a good position, though. They’re buying and selling at the same. Some people aren’t.

What I can’t figure out, is why those people with the “unbalanced” Mortgages don’t just rent their houses out to schmos like my husband and I, who really want a house to rent, but can’t afford or don’t want to buy a house right now? We have a condo right now, but of course my husband wants a ‘bigger than one stall’ garage, and despite our many attempts to suggest so, our doors haven’t been caulked around, so in the winter we get a cool breeze and in the summer little bugs can crawl in under the door. A house would hopefully have a little better construction.

If so many people have ended up with a mortgage they can’t afford, why don’t they move into a lower rent place and rent out their own house for a year or so and wait on the market to rebound? Then they can keep additional debt from weighing them down and make a little money on the side. Sure, they’d have to take care of the house for the tenants, but they’d have to do it on their own anyway.

We’re hoping that with the possible change in power in the US that the markets will once again be at a steady pace. The American dream will be able to get back on track and once again people will be able to afford the home that they really want.


  1. There are TONS of homes for rent in my area and nobody renting them. Therein lies the problem. People are scared if they move to a new house and a new mortgage without the previous home sold, and they can’t attract or keep tenants to their prior home, then they are up the creek. Also, if you keep your prior home as a rental property, all the home maintenance falls to the owner, and that can be a major hit.

  2. Most people that ended up with a mortgage they can’t afford have mortgages that not a lot of people could afford. If they did rent their house, they’d have to get at least what the mortgage is. Anyone with a brain would want to charge a little more than the mortgage and either have that “extra” money as fun money or set it aside for any repairs that will need to be done. As the comment above me said, all maintenance falls to the owner.

    A friend of our’s bought a new house for $400,000. Couldn’t sell his first house, so he rented it. Mortgage is $1400 a month, he rented it for $1800. But, if the renter defaults on the lease or doesn’t renew in a new, the friend may be stuck. It’s a risk.

    But, I do agree with you–if you can’t sell it, rent it. At least it’s not empty and the mortgage will be paid. I don’t want to own. But, I’m tired of renting in an apartment complex. I don’t like people enough to be surrounded by them all the time 🙂

  3. IMHO a lot of people bought what they couldn’t afford while mortgage rates were at an all-time low and housing prices were at an all-time high. I know a lot of very wealthy mortgage brokers and building contractors right now.

    I don’t sit on the fence with you with the “can’t sell, rent it” because I work for a company that manages rentals. It’s a scary business.

  4. It makes sense for some but in our case our house payment was close to $2000 a month and I’m sure we could not have rented it out for that.

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