Not sure whether to rent or sell your Murfreesboro home? You are not alone. In a fast-growing city, keeping a house as a rental can sound smart, but the details matter. In this guide, you will get a clear checklist of numbers to gather, a simple cash flow example with local figures, and the legal and tax points to consider before you decide. Let’s dive in.
Murfreesboro rental demand at a glance
Murfreesboro continues to grow, with an estimated population of about 168,000 as of July 2024. That growth supports steady rental demand from students, healthcare workers, logistics teams, and manufacturing employees. U.S. Census QuickFacts shows the city’s size and momentum.
For pricing, recent trackers place citywide average rents in a broad range of about $1,200 to $1,700 per month depending on property type and bedroom count. As one reference point, RentCafe reports an average apartment rent of about $1,564 per month as of February 2026. Roughly half of local households rent, which helps keep well-presented listings in demand.
Will it cash flow? Run these numbers
Before you choose rent over sell, build a 12-month view of income and costs. Use conservative assumptions.
Use this checklist:
- Market rent for your specific home, based on nearby comps with similar beds, baths, yard, and condition
- Vacancy allowance, often 6 to 10 percent of gross rent
- Mortgage payment, including principal and interest
- Property taxes and landlord insurance (often higher than a homeowner policy)
- Utilities you will cover, if any
- HOA dues and any rental rules in your community
- Routine maintenance reserve, plus a capital reserve for big items like roof or HVAC
- Property management fee and leasing fee if you will hire a manager. Long-term management often runs 8 to 10 percent of rent, and leasing is commonly a portion of the first month’s rent. Local pricing examples reflect these ranges. See one local fee schedule.
- One-time make-ready costs to prepare the home for tenants
- For short-term rentals, add cleaning, supplies, platform fees, and occupancy tax compliance
Quick example with local figures (Feb 2026)
This illustration uses citywide averages to show the math. Plug in your own numbers for a real decision.
- Rent assumption: $1,564 per month based on RentCafe’s February 2026 snapshot
- Home value proxy: about $419,000 for a typical Murfreesboro single-family home
Now the steps:
Annual gross rent: $1,564 × 12 = $18,768
Gross rental yield: $18,768 ÷ $419,000 ≈ 4.5 percent
If operating expenses consume 35 to 45 percent of gross rent, your net operating income (NOI) would be roughly $10,300 to $12,200. On a $419,000 value, that is a cap rate of about 2.5 to 2.9 percent.
What does that mean? For many owners, single-family conversions can show low cap rates. That does not make renting a bad idea. Your unique mortgage rate, tax situation, management choice, and expected appreciation can tilt the decision either way. Use cash-on-cash return if you carry a mortgage since financing changes the picture.
What moves the needle most
- Self-managing saves the 8 to 10 percent management fee, but it costs time and increases risk.
- A lower basis or high equity improves returns. A recent refi at a low rate also helps.
- Strong tenant demand for your specific floor plan or location can support higher rent.
- Short-term rentals can push revenue higher but come with higher fees, more work, and extra tax filings.
Long-term vs short-term renting
Both paths can work. Match the approach to your goals, tolerance for involvement, and local rules.
Long-term rental
- Pros: steadier income, lower wear and tear, simpler bookkeeping, lower management fees
- Consider: tenant screening, vacancy between tenants, routine maintenance, local property standards
Short-term rental
- Pros: potential for higher gross income, flexible owner use
- Consider: higher management costs, frequent cleanings, guest support, and occupancy tax filings. Murfreesboro imposes a 5 percent hotel/motel occupancy tax on short stays. Review the city’s guidance on hotel and motel taxes.
Legal essentials in Tennessee
You take on specific responsibilities when you become a landlord. Build them into your plan.
Security deposits
Tennessee requires deposits to be held in a separate account and sets inspection and itemization rules for move-out. Failing to follow the statute can cost you the right to keep funds. Review Tenn. Code Ann. § 66-28-301 for details. See the statute summary.
Notices and evictions
For nonpayment, Tennessee landlords generally must give a 14-day notice to pay or quit. Other lease breaches follow set notice periods. Eviction is a court process, so plan for time and cost in your vacancy reserve. Read a practical overview of timelines and notices here: Tennessee eviction basics.
City codes and HOA rules
Murfreesboro enforces property maintenance and nuisance standards. Check the city code and your HOA’s covenants before you list the home for rent. Start with the Murfreesboro Code of Ordinances and confirm any neighborhood rules on rentals.
Taxes that can swing your decision
Taxes can turn a break-even rental into a keeper or make selling the better move. Talk with a CPA before you lock in your plan.
Selling a primary home
If you owned and lived in the home for at least 2 of the last 5 years when you sell, you may exclude up to $250,000 of gain if single or $500,000 if married filing jointly. Converting to a rental can affect timing and eligibility, so map out your dates. See the worksheets in IRS Publication 523.
Renting and depreciation
Residential rentals are depreciated over 27.5 years, which reduces taxable rental income. Depreciation is recaptured when you sell, so plan for that future tax. Rules on passive losses, active participation, and real estate professional status can change how deductions work. Start with IRS Publication 527.
Inherited property
Inherited homes often receive a step-up in basis to fair market value at the date of death. That can limit or eliminate past appreciation and prior depreciation for tax purposes, which is why inherited properties can be strong rental or sale candidates depending on goals. Read a plain-language overview of the step-up concept here: step-up in basis explained. Confirm the valuation with your advisor.
Decision framework: rent or sell?
Use these quick filters after you run your numbers.
Renting may make sense if:
- After a realistic vacancy and expense load, your cash flow is positive or near break-even with strong appreciation potential.
- You can self-manage or have a clear plan for professional management that fits your budget.
- You want to keep a foothold in Murfreesboro for the long term.
Selling may make sense if:
- Your cash-on-cash return is weak even with conservative costs, or your time horizon is short.
- You qualify for the home sale gain exclusion now, but could lose it by waiting.
- Proceeds from a sale can be put to better use for your family or other investments.
Get local support
If you want a clear rent-or-sell plan for your specific address, we can help you price rent, model cash flow, and quote full-service management so your numbers are apples to apples. Ready to get started? Connect with The Scott Zeller Team for a free home valuation or management quote.
FAQs
How much can I rent my Murfreesboro home for?
- Most homes land between about $1,200 and $1,700 per month depending on size, condition, and location. A recent city average was about $1,564 per month as of February 2026. Your exact rate should come from recent comps for similar homes.
What are typical property management fees in Murfreesboro?
- Long-term management is commonly 8 to 10 percent of monthly rent, with a separate leasing or tenant placement fee. Short-term rental management often costs more due to bookings and cleanings.
How does the 5 percent hotel or motel tax affect short-term rentals in Murfreesboro?
- Stays under 30 days are subject to a local occupancy tax. You or your platform must collect and remit it, usually monthly. Confirm filing steps before you host.
What Tennessee rules apply to security deposits and evictions?
- Deposits must be held in a separate account with proper move-out documentation. For nonpayment, landlords generally provide a 14-day notice to pay or quit before filing. Court timelines vary by case.
Will I still qualify for the home sale gain exclusion if I sell after renting?
- Possibly. You need to meet the 2-out-of-5-year ownership and use tests, and some periods of rental can count as nonqualified use. A CPA can help you time a sale to maximize the benefit.
