This Calculator Will Help You Decide Whether to Rent or Sell Your Home
If you have a home to sell, you can make more money over time by renting it out. This calculator from Forbes will help you decide which option is more profitable.
Forbes explains how it works:
It divides the net operating income from the rental property by the expected selling price of the home, which gives you investment income – such as bond yields. If this yield, also called the “capitalization rate,” is less than the yield on long-term Treasury bonds (about 5.7%), you are probably better off selling your home.
You simply enter a few details such as sales price, taxes and income and you will get an idea of what your “capitalization rate” looks like.
Of course, there are some other things in your decision (for example, closing costs are not calculated). However, it does give you a good general idea of which is the best option if you invest the money from the sale of the house in bonds. Check it out at the link below.