By Nick Bartlett, Realtor and owner of Freedom Rental Property Management in Maple Grove, Minnesota.
Short answer: Why is my house not selling? Price is the most common reason: the list price sits above what similar homes nearby have sold for. The other reasons are a buyer’s market with high rates and rising inventory, condition, listing photos, winter timing, new construction competing with builder incentives, a location issue you can’t fix and a home that’s hard to show. If you’ve cut the price and still have no offers, your options are another cut, pulling it off the market until spring or renting it.
Key takeaways
- Lots of showings and no offers points to condition, layout or price; few showings points to price or the online listing.
- An empty house on the market costs an example owner about $2,800 a month in mortgage, taxes, utilities, insurance and lawn and snow care, or $8,400 over three more months.
- Standard homeowners policies stop covering vandalism and glass breakage once a home sits vacant for more than 60 days in a row, so check your vacancy clause or switch to a landlord policy.
- A price cut that drops your net below the mortgage payoff means bringing cash to closing.
- The same $400,000 home rented at $2,600 a month on a 3% mortgage returns about $27,646 in its first year, or 18.4% on $150,000 of equity, counting cash flow, mortgage paydown, appreciation and depreciation.
- On a fixed-rate mortgage, rental cash flow grows every year; in our example it rises from $535 a month in year one to about $3,600 a month once the loan is paid off.
- Renting the house for one to three years keeps the home sale tax exclusion intact if you lived there at least 2 of the 5 years before you sell.
Why is my house not selling? The 8 most common reasons
1. It’s priced above recent sales
Buyers and their agents compare your list price with homes like yours that sold in the last few months, not with your neighbor’s asking price. If your price is 5% above the closest comparable sales, buyers skip it and wait for a cut.
2. It’s a buyer’s market
A buyer’s market is a market with more homes for sale than buyers to buy them. When mortgage rates are high, fewer buyers qualify and the ones who do can afford less house. When inventory climbs at the same time, every buyer has more choices and less reason to pay your price. Minnesota home inventory reached its highest level in seven years, according to Minnesota Realtors, so homes take longer to sell and price cuts come sooner.
3. Showings, but no offers
When buyers come through and don’t write offers, they’re telling you something about the house: dated finishes, odors, pet damage, deferred maintenance or a layout that doesn’t work for the price.
4. Few showings at all
Few showings means buyers rejected the home online. That’s price, weak photos or a listing description that doesn’t sell the home.
5. Winter timing
In my experience, Twin Cities buyer traffic drops from November through February and picks up again in March. A home listed in December competes with fewer buyers and looks stale by spring.
6. New construction nearby
In growing suburbs like Rogers, Otsego and Dayton, builders offer mortgage rate buydowns and closing cost credits that a resale seller can’t easily match. A buyer looking at your home is also touring the model down the road.
7. Something you can’t change
A busy road, power lines, a steep driveway or a small lot narrows the buyer pool. The fix is price, because the house can’t move.
8. It’s hard to show
Tight showing windows, a lockbox that doesn’t work, pets in the home or an occupied, cluttered house cost you showings. Every showing you turn away is a buyer who writes an offer somewhere else.
Minneapolis Area REALTORS publishes local market data each month, including days on market and months of supply, so you can see how fast homes like yours are selling.
What does it cost to keep an unsold house on the market?
Holding costs are what you pay to own an empty house while it waits for a buyer. For an example Twin Cities home, the monthly bill looks like this:
| Mortgage payment | $1,900 |
| Property tax | $400 |
| Utilities | $250 |
| Insurance | $150 |
| Lawn and snow care | $100 |
| Total per month | $2,800 |
Three more months on the market at $2,800 a month costs $8,400, and that’s on top of the mortgage on the home you’ve already moved into. Add HOA dues if you have them.
Vacancy also changes your insurance. Standard homeowners policies stop covering vandalism and glass breakage once a home has been vacant for more than 60 consecutive days. Call your agent before you hit that mark, and see our guide to rental property insurance in Minnesota for the policy you need once a tenant moves in.
Should you lower the price, wait or rent the house?
When a house hasn’t sold after a price cut or two, an owner has three choices. Each one costs something.
| Option | What it costs | When it fits |
|---|---|---|
| Cut the price again | Lower proceeds; possibly cash at closing if you drop below the payoff | You need the equity now and still have room above the payoff |
| Pull it and relist in spring | Several more months of holding costs on an empty house | You listed in late fall and the price is close |
| Rent it | Prep, a rental license and a lease commitment | The rent covers the costs and you don’t need the equity right away |
Every price cut comes straight out of your proceeds. Once the price drops low enough that the sale price minus selling costs is less than your mortgage balance, you have to write the bank a check at closing to sell. Renting stops the bleeding: tenants pay the mortgage, taxes and insurance while the home waits for a better market. Run your own numbers with our rent vs sell calculator.
What changes when you rent a house that won't sell?
Renting a house that won’t sell turns a monthly expense into a monthly income, but it also turns you into a landlord with Minnesota legal obligations. Here’s what happens:
- Cancel the listing first. A home listed for sale and for rent at the same time confuses both buyers and renters, so we take over only after the listing is cancelled.
- Get a rental license. Minneapolis, Brooklyn Park, Richfield and other Twin Cities cities require a rental license and inspection before a tenant moves in. Our city pages, like Brooklyn Park, list each city’s rules.
- Plan on about two months. Prep, marketing, screening and the tenant’s move-in date take about two months from the day the listing comes down.
- Sign a 12 month lease. Time the lease to end in late spring so you have the option to sell into the busiest season.
- Keep your tax window in mind. If you lived in the home at least 2 of the 5 years before the sale, you can rent it for up to about 3 years and still exclude up to $250,000 of gain ($500,000 married filing jointly). Our guide Should I Sell or Rent My House? covers the tax side.
If your house isn't selling, how does renting it pay you?
A rental house pays its owner four ways, and cash flow is only one of them. An owner who rents a house that wouldn’t sell stops paying holding costs and starts collecting a return on the equity sitting in the home.
An example: a $400,000 home renting for $2,600
Take a $400,000 Twin Cities home with a $250,000 mortgage balance at 3%, 25 years left on the loan. The owner has $150,000 of equity in it. The payment is $1,186 a month, and property tax, landlord insurance, a repair reserve, vacancy and management add $879. Here’s what the home earns in its first year as a rental:
| Cash flow ($535 a month) | $6,426 |
| Mortgage paydown from the rent | $6,820 |
| Appreciation at 3% a year | $12,000 |
| Tax savings from depreciation | $2,400 |
| Total first-year return | $27,646 |
That’s about 18.4% on the $150,000 of equity, compared with paying $2,800 a month to hold the same house empty.
Most of a rental’s return is equity, not cash. In the example, appreciation makes up 43% of the $27,646 year-one return, mortgage paydown 25%, cash flow 23% and depreciation tax savings 9%. Here’s how each one works.
1. Cash flow
Cash flow is the rent left over after the mortgage and every operating cost. In the example, $2,600 of rent minus a $1,186 payment and $879 of costs leaves $535 a month. A low mortgage rate is what makes this number work; the same house on a 7% loan would lose about $46 a month.
2. Mortgage paydown
Every payment the tenant’s rent covers lowers your loan balance. On a $250,000 balance at 3%, the principal paid in the first year is $6,820, and that number grows every year as more of each payment goes to principal.
3. Appreciation
Appreciation is the rise in the home’s value. At 3% a year, a $400,000 home gains $12,000 in year one. Appreciation isn’t guaranteed in any single year, but renting lets you wait for a better market instead of selling into a soft one.
4. Tax savings from depreciation
Depreciation is a deduction for the wear on the building (not the land) spread over 27.5 years under IRS Publication 527. On $275,000 of building value, that’s $10,000 a year, which saves $2,400 in federal tax at a 24% bracket and shelters the cash flow from income tax. Depreciation is taxed at up to 25% when you sell, so plan for it. Our guide to the tax side of turning your Minnesota home into a rental covers the details.
These are example numbers; your rent, taxes and loan decide your real return. Run your own with the rent vs sell calculator, read Is Rental Property a Good Investment? or start with our step-by-step guide on how to rent out your house.
What does a house that wouldn't sell pay you if you keep renting it?
If your house isn’t selling, renting it doesn’t have to be a stopgap. A rental pays you more every year you keep it, because the rent rises while a fixed-rate mortgage payment doesn’t. That’s why a house you rent “until the market improves” can turn into the best investment you own.
In the example of a $400,000 home renting for $2,600 on a 3% mortgage, monthly cash flow grows from $535 in year one to $1,060 by year 10, $1,832 by year 20 and $3,603 once the loan is paid off in year 26. Add the mortgage paydown, appreciation and depreciation tax savings, and the cumulative total return reaches about $334,000 by year 10, $825,000 by year 20 and $1.22 million by year 26.
Why cash flow jumps after the mortgage is paid off
The biggest monthly cost on a rental is the mortgage payment, and on a fixed-rate loan that payment never goes up. In the example, the payment is $1,186 a month for 25 years while the rent rises 3% a year, so cash flow grows a little every year: from $535 in year one to $1,832 by year 20.
When the last mortgage payment is made at the end of year 25, that $1,186 drops off entirely. The rent hasn’t changed, but the biggest expense is gone, so cash flow nearly doubles overnight to about $3,600 a month in year 26. From there, the only costs left are property tax, insurance, repairs, vacancy and management, and the rent keeps rising faster than they do.
The same thing happens to your equity. Every year the tenant’s rent pays down more principal, until the house is owned free and clear and worth about $863,000 at 3% appreciation.
Here’s the same $400,000 home renting for $2,600 on a 3% mortgage with a $250,000 balance and 25 years left, assuming rent, costs and home value each grow 3% a year:
| Year | Monthly rent | Monthly cash flow | Loan balance | Home value |
|---|---|---|---|---|
| 1 | $2,600 | $535 | $243,180 | $412,000 |
| 10 | $3,392 | $1,060 | $171,671 | $537,567 |
| 20 | $4,559 | $1,832 | $65,977 | $722,444 |
| 26 (paid off) | $5,444 | $3,603 | $0 | $862,637 |
Once the loan is paid off, this one house pays about $3,600 a month, and the rent keeps rising with inflation. These are example numbers, not a forecast, but the pattern holds for any rental bought or kept with a fixed-rate mortgage.
Why keeping the house can be a strong retirement plan
A 401(k) is a balance you spend down in retirement, and the risk is outliving it or selling investments in a down market to pay the bills. A paid-off rental works differently: you live on the rent and never touch the asset. The house keeps paying as long as you own it, and you can still sell it, refinance it or leave it to your kids.
Two or three paid-off rental homes can cover a large share of a household’s retirement income. The house that wouldn’t sell can be rental number one. So before you cut the price on a house that isn’t selling, or list it again in spring, ask whether you’d rather have the sale proceeds or the rent check for the next 30 years.
Should you manage the house yourself or hire a property manager?
Owners in this spot rarely planned to be landlords. Minnesota rental law changes nearly every legislative session; see our summaries of the 2024 and 2025 Minnesota rental law changes. An eviction with legal fees, lost rent and repairs costs an owner $8,000 to $14,000 in our experience, and the evictions we file are mostly for new clients who tried to manage on their own first.
Hiring a professional manager like Freedom Rental Property Management keeps the time you spend close to zero. It starts with one phone call. We can get started within 2 days of that call and get your home listed for rent, and from there we handle the rental license, prep, marketing, showings, screening, the lease, rent collection and repairs.
A good property manager means you hear from them once or twice a month: when they pay you and when they need an approval. See our pricing and what a property manager does.
Frequently asked questions
Is it better to keep my house as a long-term rental?
Keeping a house as a long-term rental pays off when the rent covers your costs, because the rent rises over time while a fixed-rate mortgage payment stays the same. In our example, a $400,000 home on a 3% mortgage cash flows $535 a month in year one and about $3,600 a month once the loan is paid off.
Why is my house not selling when other homes are?
A house that isn’t selling while nearby homes sell is priced above the recent sales or has a condition or presentation problem. Compare your price with homes that actually sold in the last few months, not with active listings, and ask your agent for buyer feedback from every showing.
How long should a house take to sell in the Twin Cities?
Minneapolis Area REALTORS publishes days on market each month by city and price range. In my experience, a well-priced Twin Cities home with steady showings gets an offer within the first few weeks; if it hasn’t, the price is the first thing to revisit.
Should I lower the price or take my house off the market?
Lower the price if you need the equity now and still have room above your mortgage payoff. Take it off the market if you listed in late fall and plan to relist in spring, but budget for several more months of holding costs. Renting is the third option when the rent covers the costs.
Can I rent out my house if it won’t sell?
Yes. Cancel the listing, get a city rental license if your city requires one, switch to a landlord insurance policy and sign a 12 month lease. Freedom Rental Property Management takes on homes that didn’t sell and times the lease to end when you want the option to sell again.
Does an empty house lose insurance coverage?
Standard homeowners policies stop covering vandalism and glass breakage once the home has been vacant for more than 60 consecutive days. Call your insurance agent about a vacancy endorsement or a landlord policy before you reach that point.
House sitting on the market? One phone call is all it takes: we can get started within 2 days and get your home listed for rent. Freedom Rental Property Management helps Twin Cities owners in Maple Grove, Rogers, Otsego and across our service area rent the homes that didn’t sell. We’ll tell you what your house would rent for and what it would cost to run.
Request a free rental analysis, try the rent vs sell calculator or contact us.
