Newbie here-Potential rental w/first house-A bit overwhelmed!

[Whitney R.]

Hello all.  I hope I'm in the correct category.  If not, let me know.

I bought my first house in Oregon City, OR last fall. I found out I have to move out to the Newberg area for my work next fall or early 2019 and considering turning the house into a rental. It's a charming big old house with lots of updates and a really great location in the downtown OC area. My long-term goal has always to be a landlord but I was originally more interested in the STR biz, like Airbnb/vacation rentals..as I manage those for a living and love it. But STR are not allowed here in OC..at least not yet. I'm hoping one day it will but for now, it would have to be long-term renters..so probably less lucrative.

My concern is that rent in OC is not as high as some other areas nearby, such as Portland...so the rental fee would likely be only about $50-$100 more than my mortgage payment (my payment includes insurance/taxes, by the way..so I am accounting for that).   The home prices here in OC are appreciating..although it's anybody's guess of course how that will all play out in the future...so the house will only increase in value, I would expect.  

 Of course, option B is to sell it and, since I got a pretty good deal on it, I believe I'd either break even or get a little more back. I really prefer the rental option but don't want to be unwise about it.  I have already been told by my lender that I would be allowed to rent it out since it will have been one year of residing here and I am leaving the area. 

Can anyone offer me their thoughts as I begin to research my options?  Would the rental rate situation make this too risky?

Thanks!

[Nels Norquist]

Hi Whitney. I live in west linn and bought our first rental in Canby, just south of OC. I have been surprised by the rental demand and price in Canby, I would think Oregon city would be pretty easy to rent. Our first tenants only lasted a little over 6 months, but we had the next tenants in the same day the first ones moved out, and they have been great. I had over 15 responses in a couple of days from a simple zillow add. I looked for a family with multiple incomes that could easily afford the rent. We do allow a dog, not my favorite, but seems like everyone has a pet. I feel cats can do more lasting damage to carpet, subfloor, just a personal feeling.

I think if you can cash flow a bit I would go for it. Especially if you have a savings already. I also work with a lender who can get you a pre-approval for your next house based on you renting out your current house.

Feel free to contact me if you have specific questions. Good luck!