Table of Contents
- Should I Rent or Sell My Home and Why More Sellers Are Renting Instead of Selling in 2025
- The First-Year Reality of Being a Landlord
- Should You Use a Property Manager?
- The Financial Risk of Delayed Repairs
- Timeline and Lease Strategy
- Legal and Insurance Updates
- Real Costs of Wear and Tear
- Holding Out for a Higher Price—Is It Worth It?
- FAQ
1. Should I Rent or Sell My Home and Why More Sellers Are Renting Instead of Selling in 2025
A lot of Colorado homeowners didn’t plan on becoming landlords.
But in today’s real estate market, more sellers are deciding to rent their homes out—whether because their ideal buyer didn’t show up, they didn’t get the price they hoped for, or because they just weren’t ready to walk away from the equity they’ve built by selling at a lower price.
This shift is happening quickly. If you're facing the same decision, here's what you need to know before putting “For Rent” on your front yard.
2. The First-Year Reality of Being a Landlord
There’s a reason many experienced investors call the first year of landlording the most expensive.
Even if you’ve lived in the home for years, owning it as a rental is a different equation. You’ll need systems in place to handle maintenance, emergency calls, lease enforcement, rent collection, and possible disputes.
If you underestimate what it takes, it can cost you more than you think—financially and mentally.
3. Should You Use a Property Manager?
Yes—at least for year one.
Here’s why I always recommend it: Colorado is a tenant-friendly state. If you place the wrong tenant or fail to comply with updated rental laws, it can result in a costly and time-consuming problem.
A good property manager acts as a buffer, understands local and state laws, and can help with setting the right rent, contract, screening tenants, and handling repairs. It’s also a legitimate business expense you can deduct.
If you're unsure how to find the right one, I’m happy to share names of vetted property management professionals in the Denver Metro area.
4. The Financial Risk of Delayed Repairs
Some sellers considering renting instead of selling are trying to avoid making costly repairs flagged during inspections.
Here’s what I tell my clients: Delaying those repairs doesn’t mean they go away. You're either paying to fix them now—or you're handing off a deferred maintenance home to a tenant and crossing your fingers nothing breaks.
Even worse, some repairs could become harder (and more expensive) once someone is living in the home. For example, it’s easier to fix a sewer line when the property is vacant. It’s harder (and more expensive) when a tenant is calling you at midnight about a backup.
I’ve had sellers tell me, “I’ll just rent it instead of dealing with this,” without realizing how those same inspection items can affect their rental price, insurance, and legal exposure, along with their future sales price when their home goes back on the market.
5. Timeline and Lease Strategy
If you decide to rent, time your lease carefully.
Spring is historically one of the best times to sell in Colorado. If selling in the future is part of your plan, structure the lease around that window.
For example, instead of a 12-month lease that ends in the middle of winter, consider a 6-month or 18-month lease to better position your sale in March, April, or May.
And if the property was your primary residence, make sure you understand how long you can rent it before risking a capital gains tax bill. The general rule is that you need to have lived in the home for two out of the past five years to keep the exclusion.
6. Legal and Insurance Updates
This is one of the most overlooked areas—and it’s where many accidental landlords make costly mistakes.
First, call your insurance company. Once your home is no longer a primary residence, your coverage needs to reflect that. Otherwise, your claim could be denied in the event of a loss.
Second, talk to an attorney. When I was setting up my own estate plan, my attorney told me flat out: unprotected rental property is one of the fastest ways to lose everything in a lawsuit.
That conversation stuck with me.
I now recommend that every homeowner converting their property to a rental meet with an attorney to discuss placing the home in an LLC or another structure that fits their situation.
7. Real Costs of Wear and Tear
Let’s talk about wear and tear.
Tenants won’t treat your house like you did. Even good tenants cause wear—scuffed walls, dirty baseboards, scratched floors, stained carpet.
If you’re planning to rent for a year and then sell, factor in those refresh costs: paint, carpet, professional cleaning, minor repairs.
You may get your asking price when you list next year—but you’ll spend more than you think getting the house ready.
8. Holding Out for a Higher Price—Is It Worth It?
This might be the biggest question of all.
A lot of sellers are saying, “I’ll rent it for a year and wait for the market to go back up.”
I get it how that can be a natural initial reaction.
But here’s what I tell my clients: Do the math.
What are your holding costs—mortgage, taxes, insurance, maintenance, vacancy risk—and how does that compare to what the buyer is offering you now?
What are the odds the market rebounds enough in the next 12 months to cover those costs?
In some cases, renting makes sense. You may have strong equity, low holding costs, or a long-term plan.
In other cases, the deal in front of you is the better option—especially when you consider the risks, uncertainty, and workload that come with renting.
The decision isn’t emotional. It’s strategic.
And that’s why I walk through the numbers with my clients in real time—so they can make the right decision for their personal and financial situation.
9. FAQs (Frequently Asked Questions)
Q: Is renting better than selling in 2025?
A: It depends on your current equity, financial goals, and market conditions in your area. In Arvada and the Denver Metro area, pricing has cooled in some neighborhoods. I recommend evaluating offers carefully before defaulting to renting.
Q: Do I need to form an LLC to rent out my house?
A: Not legally, but it can help protect your personal assets. An attorney can help you weigh the pros and cons based on your situation.
Q: Can I manage the rental myself?
A: Yes, but it requires time, knowledge, and the ability to respond quickly to issues. A property manager is often a safer choice—especially for your first year. And, it’s a tax write-off.
Q: What should I tell my insurance provider?
A: Let them know your home is now a rental property. This changes the risk profile and policy terms. Not doing so could result in a denied claim.
Q: What if I change my mind and decide to sell during the lease?
A: You’re bound by the lease terms. Most leases protect the tenant's right to stay, so you likely can’t end it early unless they agree or you sell to an investor willing to keep the tenant in place.
Final Thought
I know this decision isn’t easy.
It’s why I take the time to talk it through with every client—no pressure, just facts and guidance based on real numbers, market trends, and personal goals.
If you're not sure and still thinking if “should I rent or sell my home in this market” and don’t know what to do next, let's look at your options. Whether you sell or rent, it should be a decision you make with clarity and not just reaction.
If you are looking for daily insight and tips on today’s market, follow Lauryn Dempsey on LinkedIn. If Lauryn can help you strategize your next steps in real estate in the Denver Metro Area or elsewhere across the U.S., please book a call!