You can profit by turning your home into an executive rental if you are willing to do a little work or make an investment of some money in it.
You have a property and you know you’ve been underwater on it. So do you walk away? Well, you could, but that would trash your credit rating. You may just want to consider making it an executive rental. It could be the answer to waiting out being underwater and how to make a profit in the meantime.
When the real estate bubble burst in 2008 many, many properties all of a sudden were worth a fraction of their former worth, and very often less than the mortgages that were on them. Property values were slow to come back, and in many areas haven’t come close to their pre-crash values. So if you own one of these properties, it’s tempting to walk away. Another answer can be to move into another area, rent out your home and wait the market out. Renting it out as an executive rental will mean you can demand more rent and stay ahead of the game.
Of course this might mean you need to invest some money into the property. Executive properties are more upscale. They have luxury amenities: granite, stainless steel, spacious and well-appointed rooms and bathrooms. Why, you’re thinking, would I throw good money after bad? Well, people renting executive properties know they will have to pay more to have a home that is guaranteed to be high quality. Also keep in mind that making those improvements also means your property value rises.
As an executive rental it will be much better cared for by your tenants. Executive tenants expect a certain level of quality; they are more apt to take care of it. A rental property well maintained means that you can either easily sell it later once values have risen to a point where you aren’t underwater any longer.
So don’t walk away from your underwater home, leverage it into a great asset.