Leasing vs. Selling

Should You Lease or Sell Your Colorado Springs Home?

If you’re a Colorado Springs homeowner debating whether to lease your current home or put it on the market, you’re not alone. With interest rates shifting, home prices holding steady, and the local rental market staying competitive, many owners are asking the same question:Is it smarter to keep my property as a source of rental income, or should I sell and move on?

Based on 2023 housing data, about two-thirds of Colorado Springs residents own their homes — meaning most are in the position to decide whether to sell or lease when they move.

Turning your primary residence into a rental property can create steady cash flow and long-term tax benefits, but it also comes with responsibility. You’ll need to set a competitive rent price, draft a detailed lease agreement, collect a security deposit, and follow local landlord-tenant laws. Managing potential tenants, handling rental applications, and performing background checks requires time, patience, and a solid understanding of rental laws, tenant rights, and legal requirements under the Fair Housing Act.

Your Path to Becoming a Landlord

Set Your Rental Price

Research comparable rentals, factor in mortgage/taxes/HOA, and analyze market demand.

Prepare the Property

Make necessary repairs, deep clean, ensure safety and code compliance.

Document Property Condition

Take detailed photos and videos, note existing damage, create move-in checklist.

Understand Legal Requirements

Research landlord-tenant laws, fair housing regulations, and local ordinances.

Obtain Your Lease Agreement

Purchase a template online, consult an attorney, or use a property management lease.

Market Your Rental

Take professional photos, create compelling listings, post on multiple platforms.

Schedule Property Showings

Meet potential renters, answer questions, showcase amenities, collect applications.

Screen Tenants Thoroughly

Review applications, run background and credit checks, verify employment and income.

Sign the Lease & Move-In

Review lease terms, collect security deposit, exchange keys, conduct walkthrough.

Ongoing Management & Inspections

Collect rent, handle maintenance, conduct periodic inspections, maintain compliance.

If you prefer a more hands-off approach, hiring a trusted property manager or property management company can help screen tenants, oversee maintenance costs, and ensure your rental home stays in good condition. Professional managers also understand the nuances of local laws, eviction notices, rental licenses, and insurance policies like landlord insurance—critical for protecting your investment against property damage or a natural disaster.

What Property Managers Handle

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Tenant Screening

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Maintenance

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Rent Collection

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Legal Compliance

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Property Inspections

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Eviction Process

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24/7 Communication

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Financial Reporting

On the financial side, you’ll need to factor in property taxes, hoa fees, mortgage interest, and the possibility of vacancy rates affecting your monthly bottom line. The right decision often depends on your mortgage lender’s terms, your equity position, and the tax implications—from capital gains if you sell, to tax deductions and taxable income if you rent.

Tax Deductions for Rental Property Owners

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Mortgage Interest

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Property Taxes

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Repairs & Maintenance

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Insurance

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Management Fees

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Travel Costs

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Utilities

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Professional Fees

A knowledgeable real estate attorney or experienced real estate agent can help you navigate these moving parts. Some owners even explore short-term rentals or vacation homes to maximize income, while others prefer to convert their home into a traditional investment property. Every type of rental—from residential buildings and rental units to rental property investments—has unique rules on rent control, conventional loans, and even fha loan eligibility. Understanding these variables is essential before taking your next step.

Whether you’re considering renting for a few months’ rent or becoming one of the many new landlords in the area, this guide will help you compare both options side-by-side. You’ll learn how rental income, maintenance costs, and tax implications stack up against the potential profit from selling your home in today’s local market—so you can make the decision that’s right for your finances and your future.

Local Market Statistics

Understanding the Numbers Behind Your Decision. Whether you decide to sell your home or lease it out, your success hinges on timing — and timing comes down to market data. The four key statistics below give you a clear snapshot of how the Colorado Springs real estate market is behaving right now.

Each metric answers a different version of the same question: Is it smarter to cash out your equity today, or hold and rent for steady income?

Days on Market

Days on market matters because it reveals how quickly homes like yours are selling — a short timeframe signals strong buyer demand, while longer times suggest the market may favor renting instead.

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Months of Inventory

Months of inventory shows how long it would take to sell all available homes at the current sales pace — fewer months means a seller's market, while more months favors buyers and renters.

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Median Sales Price

The median sales price represents the middle point of all home sales — this helps you understand current market values and whether selling or renting makes more financial sense.

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Price-to-Rent Ratio

The price-to-rent ratio compares home prices to annual rent — a higher ratio suggests renting may be more economical, while a lower ratio favors buying.

Below 15: Buying is typically favorable
15-20: Neutral zone - buying vs. renting depends on personal factors
Above 20: Renting is typically more economical

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These figures are based on a 3 bedroom, 2 bathroom, single family home in El Paso County, Colorado

Lease vs. Sell Calculator – Colorado Springs

Estimate your net if you sell today vs. the after-tax value of leasing for a few years, then selling later.

Selling

Home Value / Expected Sale Price ($)

Mortgage Balance to Payoff ($)

Real Estate Commission (%) 6%

Cap Gains Effective Rate (%)*

*Set to 0% if owner-occupied and you expect full exclusion. Ask your CPA for specifics.

Leasing

Monthly Market Rent ($)

Vacancy Rate (%)

PM Fee (% of collected rent)

Maintenance/CapEx (% of rent)

Taxes + Insurance (annual, $)

Income Tax on Rental Profit (%)

Shared Assumptions

Holding Period (years) Discount Rate (%) Home Appreciation (%/yr)

What these assumptions mean:

Holding Period: How many years you plan to rent the property before selling
Discount Rate (Opportunity Cost): What rate of return you could earn on the money if invested elsewhere (like stocks or other investments). Higher rate = selling now looks better.
Home Appreciation: Expected annual increase in your home's value. Colorado Springs has historically averaged 3-5%/year.

Important: This calculator simplifies depreciation, mortgage interest deductions, and capital gains recapture. For tax-specific guidance, consult your CPA or tax advisor.

Leasing vs. Selling

Should You Lease or Sell Your Colorado Springs Home?