If you’re moving and your current home has a low mortgage rate, keeping it as a rental will often build more wealth than selling it. That only holds if three things are true: the rent covers all of your costs, you don’t need the equity for your next down payment, and you’re ready to be a landlord or pay someone to do it for you.
Plug your numbers into the calculator below, then use the rest of this guide to pressure-test the result.
| Keep it as a rental if | Sell it if |
|---|---|
| The rent covers your mortgage payment plus repairs, vacancy and management | The rent won’t cover your costs, or only covers them if nothing goes wrong |
| You can buy your next home without the equity | You need the cash for your next down payment |
| You have a low mortgage rate you couldn’t get again | Your home is worth a lot relative to the rent it would bring in |
| You’re willing to manage it, or the numbers still work after paying a property manager | You don’t want to be a landlord and management fees would wipe out the cash flow |
Run your numbers
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Your results
- Keep it
- Sell it
Your numbers
Your home and mortgage
If you keep it
Not sure what it would rent for? Sign up free to fill it in from the BiggerPockets Rent Estimator.
Selling and growth
Year-by-year comparison
Each year, the model adds what the rental clears to your investments and compares your net worth if you keep the home with your net worth if you sell it now and invest the cash. Years 5, 10 and 30 are highlighted.
| Year | Home value | Mortgage balance | Rental cash flow | Net worth if kept | Net worth if sold | Ahead |
|---|---|---|---|---|---|---|
| 1 | $450,824 | $256,223 | $6,300 | $167,089 | $153,230 | Keep |
| 2 | $466,152 | $248,221 | $7,031 | $196,931 | $168,553 | Keep |
| 3 | $482,001 | $239,988 | $7,787 | $229,007 | $185,408 | Keep |
| 4 | $498,389 | $231,518 | $8,568 | $263,519 | $203,949 | Keep |
| 5 | $515,334 | $222,803 | $9,377 | $300,688 | $224,344 | Keep |
| 6 | $532,856 | $213,836 | $10,212 | $340,755 | $246,778 | Keep |
| 7 | $550,973 | $204,610 | $11,076 | $383,985 | $271,456 | Keep |
| 8 | $569,706 | $195,118 | $11,970 | $430,669 | $298,602 | Keep |
| 9 | $589,076 | $185,352 | $12,893 | $481,127 | $328,462 | Keep |
| 10 | $609,105 | $175,304 | $13,849 | $535,708 | $361,308 | Keep |
| 11 | $629,814 | $164,965 | – | $589,279 | $397,439 | Keep |
| 12 | $651,228 | $154,329 | – | $648,207 | $437,183 | Keep |
| 13 | $673,370 | $143,385 | – | $713,027 | $480,901 | Keep |
| 14 | $696,264 | $132,125 | – | $784,330 | $528,992 | Keep |
| 15 | $719,937 | $120,539 | – | $862,763 | $581,891 | Keep |
| 16 | $744,415 | $108,620 | – | $949,039 | $640,080 | Keep |
| 17 | $769,725 | $96,356 | – | $1,043,943 | $704,088 | Keep |
| 18 | $795,896 | $83,738 | – | $1,148,338 | $774,496 | Keep |
| 19 | $822,956 | $70,756 | – | $1,263,171 | $851,946 | Keep |
| 20 | $850,937 | $57,399 | – | $1,389,489 | $937,141 | Keep |
| 21 | $879,869 | $43,656 | – | $1,528,437 | $1,030,855 | Keep |
| 22 | $909,784 | $29,516 | – | $1,681,281 | $1,133,940 | Keep |
| 23 | $940,717 | $14,968 | – | $1,849,409 | $1,247,334 | Keep |
| 24 | $972,701 | $0 | – | $2,034,350 | $1,372,068 | Keep |
| 25 | $1,005,773 | $0 | – | $2,237,785 | $1,509,275 | Keep |
| 26 | $1,039,969 | $0 | – | $2,461,564 | $1,660,202 | Keep |
| 27 | $1,075,328 | $0 | – | $2,707,720 | $1,826,222 | Keep |
| 28 | $1,111,889 | $0 | – | $2,978,492 | $2,008,844 | Keep |
| 29 | $1,149,694 | $0 | – | $3,276,341 | $2,209,729 | Keep |
| 30 | $1,188,783 | $0 | – | $3,603,975 | $2,430,702 | Keep |
How the calculator works
- Selling now. You get the home’s value less selling costs and your mortgage balance, and invest it at your investment return.
- Keeping it. Each month the rent pays your mortgage payment, your monthly costs and, if you hire one, a property manager. What’s left over (or what you pay in) is your cash flow, which is invested at your investment return.
- Your equity grows. The home’s value, the rent and your costs rise at the yearly growth rate, and every payment pays down the mortgage. Once it’s paid off, only taxes and insurance remain.
- You sell later. In the year you’d stop keeping it, the home is sold, less selling costs and what’s left on the mortgage, and the cash is invested from then on.
- Compare your net worth. Net worth is what you’ve invested plus, while you still own the home, what selling it would bring. The headline compares the two options in the year you’d sell.
This is a simplified model meant for planning, not a guarantee. It leaves out taxes, including capital gains on a sale, and the cost of your next home. Talk to a tax professional before you decide.
Which situation are you in?
- I’m moving and buying a new home. This guide is mostly for you. Start with the five questions below.
- I’m retiring. Read the five questions, then skip to selling or renting in retirement.
- I’ve already decided to rent it out. Jump to how to rent out your house.
The five questions that decide it
1. Does the rent cover all of your costs?
Your mortgage payment is only part of the picture. A rental also needs money set aside for repairs, big-ticket replacements like a roof or HVAC system, the months it sits empty, and property management if you won’t do it yourself.
A common rule of thumb, the 50% rule, says those operating costs (everything except the mortgage) tend to eat about half of the rent over time. It’s a rough screen, not a substitute for real numbers, but if the rent minus half doesn’t cover your mortgage, that’s an early warning.
Here’s how it looks for the home in our worked example, updated to 2026: a home renting for $2,710 a month, with a $1,618 payment and $567 a month set aside for maintenance, capital expenses and vacancy. Managing it himself, the owner keeps about $525 a month. With a property manager taking 10% of rent, that drops to about $255.
2. Do you need the equity for your next home?
Selling turns your equity into cash. In the same example, selling a $436,000 home with a $264,000 mortgage nets about $139,000 after 7.5% in selling costs.
If that money is your down payment on the next house, keeping the old one may not be realistic. If you can buy the next home without it, keeping becomes a real option.
3. What mortgage rate would you be giving up?
This is the question that changed the math in the last few years. In the example, the owner’s mortgage is fixed at 2.85%. As of October 29, 2026, the average 30-year fixed rate was 7.24%, according to Freddie Mac’s weekly survey.
On a $264,000 loan, that’s the difference between about $1,092 a month in principal and interest at 2.85% and about $1,799 at 7.24%. That’s roughly $707 more every month for the same debt.
A low rate is one of the best things a rental can have, and once you sell, it’s gone for good.
4. Do you want to be a landlord?
Be honest with yourself here. Managing a rental means finding and screening tenants, handling repairs and dealing with the occasional late-night call. If you’re moving far away, that gets harder.
You can hire a property manager instead, and our free Property Manager Finder can help you find one. It costs money, though. In the example, management fees cut monthly cash flow by more than half. Run the calculator both ways.
5. How will taxes affect your decision?
When you sell a home you’ve lived in for at least two of the last five years, you can generally exclude up to $250,000 of profit from capital gains tax, or up to $500,000 if you’re married and file jointly (IRS Publication 523). Rent the house out for long enough and you can lose that exclusion. Taxes are personal, so talk to a tax professional before you decide. Our free Tax Pro Finder can match you with an investor-friendly tax pro.
A worked example: “Average Joe”
In 2024, BiggerPockets Money co-host Scott Trench modeled this decision for a typical American homeowner he called Average Joe, and for a family in a $1 million home. Read the full analysis.
We’ve run both homes forward to 2026, with today’s home values and rents and two more years of mortgage payments.
| The numbers | Average Joe | $1 million home |
|---|---|---|
| Home value | $436,000 | $1,050,000 |
| Mortgage balance and rate | $264,000 at 2.85% | $399,000 at 2.85% |
| Monthly payment (taxes and insurance included) | $1,618 | $2,927 |
| Rent | $2,710 | $3,960 |
| Monthly cash flow, self-managed | About $525 | About $190 |
| Monthly cash flow, with a property manager | About $255 | About -$210 |
| Cash from selling, after 7.5% costs | About $139,000 | About $572,000 |
| Verdict | Keep it | Sell it |
For Joe, keeping the house still wins. Even paying a property manager, keeping it for 10 years comes out about $115,000 ahead of selling now and investing the proceeds.
For the $1 million home, selling still wins. The house rents for less relative to its value, and with outside management it loses money every month. Even managing it himself, the owner comes out about $300,000 ahead after 10 years by selling now and investing the cash.
The takeaway: a low payment relative to rent favors keeping, while a high-value home with low rent and lots of equity tends to favor selling.
Will renting it out work in your market?
BiggerPockets’ Dave Meyer created a simple way to check: the rent-to-payment ratio. Divide one month’s rent by your full monthly mortgage payment, including principal, interest, taxes and insurance. In the Summer 2026 Rent-to-Payment Report, he ranks every large U.S. metro this way, and a ratio of 1.0 or higher points to strong cash flow.
A low-rate mortgage gives your home a head start. In the example, $2,710 in rent against a $1,618 payment works out to about 1.67. A new mortgage on the same house at today’s rates would cost far more each month and pull that ratio down. Check where your metro sits in the report, then compare it with your own ratio in the calculator.
What BiggerPockets members weigh up
This question comes up in our forums all the time. A few themes come up again and again:
- A low-rate mortgage is an asset that’s hard to replace.
- The timing of a sale matters for capital gains, so plan your exit before you rent it out.
- Managing a rental from another state is harder than it looks, and a poorly managed property can lose value fast.
Read how other homeowners worked through it:
- Rent or sell primary home, after relocating (February 2026)
- Rent or Sell (December 2025)
- Sell or Rent?! (August 2025)
- Sell or Keep primary home as rental (June 2025)
Have a situation that doesn’t fit the calculator? Ask the community.
How to rent out your house
Decided to keep it? Here’s what to sort out before your first tenant moves in. For the full walkthrough, read our step-by-step guide to renting out your house.
- Check the rules. Landlord-tenant law varies by state and city, and some HOAs limit rentals. Start with our Landlord-Tenant Laws by State resource.
- Set the right rent. Price it too high and it sits empty, too low and you leave money on the table. The Rent Estimator shows what similar homes nearby rent for.
- Switch to landlord insurance. A standard homeowners policy is written for a home you live in, so talk to your insurer before you rent it out. You can compare quotes with our Landlord Insurance Calculator.
- Get the property ready and document it. Make repairs, then record the condition room by room so you have a record when the tenant moves out. Our Move-In/Out Inspection Sheet and Landlord’s Unit Information Sheet make this easier.
- Screen tenants carefully. The right tenant matters more than almost anything else. The Tenant Screening Guide for Landlords walks you through it, from fair criteria to credit and eviction checks.
- Decide who manages it. If you’re moving far away, a property manager may be worth the cost, and the Property Manager Finder can match you with one. In the example, a 10% management fee cuts monthly cash flow from about $525 to about $255, so build that into your numbers before you decide.
- Track it like a business. Use the Rental Property Calculator to keep an eye on cash flow and returns as rents and costs change.
Selling or renting in retirement
In retirement, the trade-off shifts. Selling gives you cash and simplicity: no tenants, no repairs and money you can use now. Keeping gives you rental income and a home that may keep growing in value, but it also keeps you in the landlord business, or paying someone to run it.
Ask yourself how much monthly income you need, how much risk you’re comfortable with if a big repair hits, and whether you’d rather have the equity working for you as cash. The calculator works the same way for this decision.
Your next steps
- Keeping it? Work through the steps to rent out your house above, starting with screening your first tenant.
- Selling? Find an investor-friendly agent who knows your market with the Agent Finder. It’s free.
- Want to hear it talked through? Listen to the BiggerPockets Money episode where the hosts walk through the spreadsheet.
Frequently asked questions
Is it more profitable to rent or sell a house?
It depends on your numbers. In BiggerPockets’ 2024 analysis, a typical homeowner with a low-rate mortgage built far more wealth by keeping their home as a rental, while a family in a $1 million home with a small mortgage did better by selling. Run forward to 2026, both results still hold. The calculator above shows which side you’re on.
What is the 50% rule in rental property?
It’s a rule of thumb that a rental’s operating costs, not counting the mortgage, run about half of its rent over time. Use it as a quick screen, then run real numbers.
Should I rent out my house when I move?
Consider it if the rent covers all of your costs, including management if you won’t do it yourself, you don’t need the equity for your next home, and you’re ready for the work of being a landlord.
Will I pay capital gains tax if I rent out my house and then sell it?
Possibly. The home sale exclusion generally requires that you lived in the home for two of the last five years before selling, so renting it out for too long can cost you the exclusion. Talk to a tax professional about your situation.
Get the full spreadsheet
Want to dig into every assumption? Create a free BiggerPockets account to download the full sell vs. keep spreadsheet behind this calculator.
This content is not intended to serve as legal, tax, or other financial advice related to individual situations. Consult with your own attorney, CPA, and/or other advisor regarding your specific situation.