Should I turn my house into a rental?

[Ryan Garvey]

Hi fellow BPers, my wife and I are considering upgrading houses and keeping our 2/1 house as a rental property? Question for those w/knowledge & EXPERIENCE: is this a good idea, why/why not?

The house is a 1924 property in good condition (roof, HCAV, foundation,etc). Our monthly mortgage is $974 (so ideally rent would be >$1,125/month). I’m not sure we’ll get the desired rent since rentometer says ave is $885?

Considering adding a 1/2 bath in our kitchen pantry which has ample space, in order to add equity (1 bath is a hard sell)

I’d appreciate your input and hard questions, .i.e

What am I not considering?

Thanks!

[JD Martin]

On paper this house does not sound like a good rental candidate. But there might be wrinkles:

1. How long have you been paying on the mortgage? Can the payment be reduced by lowering interest?

2. Have you actually checked your local market to see what houses similar to yours in similar areas rent for? Forget about rentometer or any other "estimator". You have to use your own knowledge of neighborhoods and houses and maybe go put eyes on the competition.

3. How strong is appreciation in your market and is it likely to continue? If you are realizing some California-esque appreciation rates, it *might* make sense to keep it even just breaking even. If not, you will probably lose your shirt based on the numbers you posted.