Buying a Home with Renting in Mind


Military families engage in home buying like no other. We buy homes in just several days and we buy homes for other people to live in. Who does that?

For one, we don’t spend much time on home shopping, but that’s because service members only receive a set amount of house hunting leave. Take time ahead of moving to whittle down the number of houses on your list, then virtually tour that list before deciding what to use your precious time on to visit in person. Taking two to three days to house hunt and having seven to eight days to decompress between assignments--priceless! 

Here’s the other, and perhaps greater, differentiator between military family home shopping and civilian family home shopping: We buy a home we’ll only live in for two or three years. That’s crazy talk by civilian standards. According to a study by the National Association of Home Builders, the average civilian family remains in their home for approximately 13 years; meanwhile, a typical military family has moved four times. Knowing that you must (typically) own a home for at least five years before breaking even on the cost of purchase and general home ownership costs, why then would military families choose to buy homes again and again?

The key word in that statement was "own." Just because you own a home doesn’t mean you have to (or get to…) live in it.

What steps should you take as you look to purchase a home with the view of renting it later?

1) Prepare your family’s short list of home needs.

Keep in mind the distinction between "needs" and "wants." A three-bedroom home to accommodate parents and four children is a legal need (most states only permit two kiddos per room), while quartz countertops are a want. Your casserole will taste just as delicious when served from Formica countertops, I promise!

Upgrades like that only become something akin to a need when they’re essential for helping to make your home competitive in a rental versus home selling market. You’ll generally need higher upgrades for selling than you will for renting, and when buying a home to rent, you want to minimize high-end upgrades when possible because that will help keep your long-term replacement costs down. 

Your list may look like something similar to the following:

  • Master bedroom suite: Having a getaway retreat is a favorite of renters and home buyers alike.
  • 2 or 3 additional bedrooms: You need space for three kids and room for visiting guests.
  • Home office: A dedicated work-from-home space or an area that could be carved out of the master bedroom or guest quarters.
  • Garage: From auto maintenance to an in-home gym, a generous garage or easy access shed is a big plus.
  • Outdoor living space: This could be a backyard patio for entertaining or a fenced yard for secure play with your children and dogs.

Although it’s fun to dream of a grand estate, you’ll actually have to make your list of needs somewhat short. By focusing on the basics, you can keep your options open and buy a home that’s both good for your family now AND good for your family’s long-term needs as an investment property. Having more practical needs in mind can help you reap dividends in the returns on this investment property. 

2) Do a little homework.

Not only for the benefit of your own family, you’ll want to find a house in a neighborhood that will interest other families.

  • Browsing the MilitaryByOwner blog, read posts about things to see and do at various military assignments.
  • Additionally, the websites Military Town Advisor and PCS Grades offer personal reviews of neighborhoods where military families have lived.
  • Perusing local news outlets will keep you in the loop of any changes with the nearby military installation and the resources it provides.

3) Research property managers. 

Imagine if military orders come up for Norfolk, Virginia, you may wonder what to do with your house in San Diego, California. Never fear! Our complimentary ebook, PCS Ahead: Should I Rent or Sell My Home, will help guide your decision whether to rent or sell. 

If you choose to rent your home, you’ll need to make a few arrangements. Before you move across the country, it’s good to have a point of contact for any repairs that might come up. Rather than traveling 2,700+ miles to fix a running toilet, a property manager nearby can be the helping hand you’ll most likely need.

Ask your real estate agent for recommendations and check out MilitaryByOwner’s business listings for property managers in your area, as well as Google reviews of property managers in your community.

4) Select a short list of no less than five property managers to contact.

Though you may find a property manager who looks ideal, he or she may not be a good fit for you based on their cost model, operational model, or because they’re simply not accepting any new clients. 

You’ll find that at least one of the other property managers simply won’t respond to your inquiry. Another one may not have sufficient answers to your questions, and you may not get a good vibe from another. Remember, you’re planning to entrust one of your greatest assets to this person, so if you don’t have a good feeling about it, trust your instinct and move on; you’ll find someone else. 

5) Prepare a template email for the property managers.

In the email you will explain who you are, and your intention. This is key. Your intention is to find a home that meets your family’s short list of requirements and is also in an area with high rental viability. The home must meet your family’s short list of requirements, so make sure you include that list. 

6) Send out the template emails and scrutinize the responses! 

However the property manager responds to you is a direct reflection of how they will respond to your prospective tenants. Keep an eye out for the following:

Timeliness: You don’t want your home sitting on the market and costing you money because your property manager is not efficient in responding to inquiries.

Communication skills: As a landlord, you are ripe for lawsuits. Make sure you have a property manager who communicates firmly and clearly, so that there will never be any misunderstandings between them and yourself or the property manager and the tenant. 

A market analysis: Does the property manager know what types of homes are in highest demand? This doesn’t have to be a fancy updated graph, but rather a discussion of the market, trends, and rental market needs. What inquiries do they receive, and what regular requests do they find hard to fill? Ideally, your short list of home needs will meet up with the requests that he finds hard to fill.  

7) Take that information back to your real estate agent to analyze with you

Is the information from the property manager’s in-line with his understanding of the market? If there are major discrepancies, then repeat the process and speak with additional property managers until you find the answers you need.

8) Run the numbers.

Make sure that you calculate not only the mortgage and interest costs, but also insurance costs, HOA costs, higher tax rates for investment rentals, property management fees, and a budget for maintenance (roughly one month’s rental is a good place to start). 

If, based on all of the market analysis that you’ve conducted, you won’t be able to rent and have these costs covered, then buying a home and rental combo this time around is not necessarily a good option for your military family. 

If that’s the case, then rather than investing in a home right now, take some time and add to your savings. Then, at your next military assignment, you’ll feel more prepared for buying a house that you could later lease.

By Karina Gafford, updated 2018 by Mary Ann Eckberg.