Sometimes your next investment opportunity isn’t “out there”… it’s right under your roof.

If you’re thinking about upsizing, relocating, or simply moving on from your current home, it might be time to ask: Should I keep this place as a rental?

Spoiler alert: the answer might be yes.

Let’s walk through some smart investor strategies that work whether you’re a first-timer or already on property #3—including one that works even when your debt-to-income ratio says no.

Start With What You Already Own

Before you list your current home, take a step back.

If you locked in a mortgage under 4% in the last few years, you might be sitting on one of the best-performing investment tools out there. Converting your current home into a rental when you move into a bigger place allows you to:

• Keep a low fixed rate
• Begin earning passive income right away
• Avoid selling in a slower market or when values are adjusting

Most mortgage payments include your escrow (your property taxes and insurance). If the market rent for your current home is higher than your total monthly mortgage payment (including taxes and insurance), you’ll cash flow each month. That surplus can go straight into your account or help cover the payment on your next home.

Pro tip: You can get a quick rental estimate using sites like Rent O Meter. It’s free if you’re just looking up a few addresses.

Bonus tip: If you plan to keep your current home as a rental, you can often use 75% of projected market rent to offset that mortgage on your debt-to-income ratio—helping you qualify for your next home more easily.

Fix and Flip, Then Refinance Into a DSCR Loan

Fix-and-flip isn’t just for HGTV stars. It can be a powerful entry point for investors who want to add value fast and refinance into something long-term.

Some fix-and-flip loans require as little as 10% down (though 20% is more common), and they often finance the renovation budget as well. That means you can borrow for both the property and the construction—making this a strategic path to build equity quickly.

To set yourself up for a smooth refinance, keep your total loan amount (purchase + renovation) below 70–75% of the ARV (After Repair Value). That way, once the work is done and the property appraises at the higher value, you can refinance into a DSCR loan with ease.

Once the renovation is complete, many investors refinance using a DSCR loan (Debt Service Coverage Ratio), which qualifies you based on rental income… not your personal income or DTI.

Why it works:

• Flexible underwriting
• No W2s or tax returns required
• Loan approval is based on the property’s income, not your job or credit profile

If the projected rental income is higher than your full mortgage payment (principal, interest, taxes, and insurance), the property is likely to qualify—and you’ll cash flow monthly.

Choose Your Rental Strategy: What Kind of Tenant Are You Serving?

Not all rentals are created equal. And not every property is a great short-term Airbnb.

Here’s a quick guide to help you decide:

• Short-term rental (Airbnb/VRBO): Best in tourist-heavy areas. High earning potential, but also more maintenance (cleanings, turnovers, guest messaging). Expect more wear and tear and the need for reliable cleaning help.
• Mid-term rental: 30–90 day leases. Ideal for traveling nurses, digital nomads, and families relocating between homes. Typically furnished, with less turnover than short-term but more flexibility than long-term.
• Long-term rental: One-year lease or more. Stable cash flow, low maintenance, and easier to manage. Best for investors who want consistency.
• Section 8 rental: Rent is backed by the government and paid consistently. You’ll need to meet local housing authority standards and inspection requirements, but the income is reliable and protected.

Choose a strategy that fits your lifestyle and goals… not just what’s trending.

Understand Appreciation vs. Depreciation

This concept might sound boring, but it’s actually where real estate flexes its power.

Real estate gives you the rare opportunity to benefit from both sides of the equation:

• Appreciation: Your property value increases over time, building equity and wealth. This means that the longer you hold your property, the more it’s likely to be worth—simply by market forces and inflation. This growth builds your net worth and allows you to tap into that equity later if needed.
• Depreciation: You can deduct a portion of your property’s value each year on your taxes, reducing your taxable income—even if the property’s value is increasing.

In short: real estate appreciates over time, building wealth, while depreciation helps offset your income on paper—making this one of the few assets that benefits you both short-term and long-term.

Ready to Build?

Whether you’re sitting on an opportunity with your current home, dreaming of a fix-and-flip, or wondering which rental route is right for you… I’m here to help.

As a licensed Realtor and mortgage lender in Tennessee and Florida, I help clients build smart portfolios that reflect their lifestyle and financial goals. And I can help investors nationwide!

Let’s map out a strategy that fits where you are and where you want to go.