The Platinum Group, REALTORS®Weldon HobbsColorado Springs | REALTOR®
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Military, PCS & VA

Should I sell or rent my Colorado Springs home when I PCS?

ByWeldon HobbsTeam Hobbs RealtyPublished Last reviewed

Short answer: It depends on your life goals, your finances, and your tolerance for being a long-distance landlord. Keeping the home can build long-term wealth, especially if it covers its costs and you might return. Selling makes more sense if the numbers don't work, you don't want the responsibility, or you'd lose tax benefits by waiting. If you rent it out, set aside a reserve of about $15,000, run it like a business, and plan for Colorado's tenant rules and the tax clock on your home-sale exclusion.

Start with your goals, not the house

Everybody has different risk tolerances. That's why the question you answer when you buy matters so much as a military member. You may have said you're okay with renting the home out someday, but you have to really think that through.

I use the Life → Wealth → Real Estate™ method for this decision:

  1. Life goals first. If you want to sell, why? If you want to keep it, why? The reason shapes everything else.
  2. Then wealth, defined broadly. Wealth is actual money, but it's also the mental tax, your knowledge, and your capability. Can you handle the thought of a tenant calling you? Will it keep you up at night? Do you know how to manage a rental, or can you learn? Many of those are solvable, but everyone's risk tolerance is different in each one.
  3. Then the real estate strategy. Keep it, sell it, or exchange it. The strategy has to complement your life and wealth goals, not the other way around.

When keeping it as a rental can make sense

As military members, we're often at a disadvantage when it comes to building a nest egg over time. We move every few years, and it's hard to put down roots. If you can buy one or two homes and manage them throughout your career, you give yourself an asset that's working for you even when you're away. That doesn't mean buying in every place you're stationed. It means choosing selectively.

Keeping the home tends to make more sense when:

  • The rent is likely to cover the mortgage and ownership costs, so the home is cash flowing.
  • You have the reserve set aside and can treat it like a business.
  • You'd like to hold real estate as part of your long-term plan.
  • There's a good chance you'll be stationed in Colorado Springs again. See whether Guardians should buy if they may be assigned here again.

My wife, Kristen, and I rented out our own homes during our moves by design, and it's a big part of how we built our rental portfolio.

For how keeping the home affects your VA benefit for the next purchase, see keeping your home as a rental and using your VA benefit again.

When selling can make sense

  • The home wouldn't cover its costs as a rental, or market conditions don't favor holding.
  • You don't want the responsibility, or the mental tax would outweigh the benefit.
  • You don't have a reserve for repairs and vacancies.
  • Waiting would cost you the tax exclusion on your gain (see below).
  • You need the equity for your next home or another goal.

For what a sale would net you, see what it costs to sell a home in Colorado Springs.

If you rent it out, run it like a business

Set aside a reserve. I like to see about $15,000 in reserve before you rent a home out, because your risk changes. It's not if something happens, but when. The reserve is what lets you handle a repair or a vacancy calmly.

Keep a separate bank account for the rental's income and expenses.

Expect quiet, and be ready anyway. Likely 99% of the time, no one is calling you. The reserve and the right contacts are for the other 1%.

Decide who manages it. If you self-manage, set up local points of contact. If you hire a property manager, vet them and understand their costs.

Use a legally sound lease that follows Colorado law.

Be honest with yourself. If being a landlord stresses you out, it may not be worth it.

Before you leave: film the house

When you live in a home, you get to know its quirks. Before you move, capture that knowledge on video:

  • Film yourself doing the routine tasks: changing the furnace filter, adjusting the thermostat, blowing out the sprinklers, and anything else the home needs.
  • Film the water shutoff. That's a huge one when you're renting it out.
  • Film a walkthrough of the whole house so you have documentation of its condition when you left.
  • Take photos before you leave so you can reuse them to market the home to future tenants or buyers.

The videos remind you how to do things, and they show your tenants how, too. You can put them on a private or unlisted video link that only people you share it with can see. Then have tenants sign that they've watched the videos and know where the shutoffs are, and reference them in the lease. We used the same practice with our short-term rental for the washer and dryer, and it made it easy to remember and to train the people staying there.

Know who to call

One of the biggest problems I see is not knowing who to call when something breaks. Before you leave, build your list: a property manager or local contact, a plumber, an electrician, an HVAC company, a handyman, and a roofer. For my clients, we provide referrals, and you can always call me.

Tax and legal rules to know

The home-sale exclusion clock. You can generally exclude up to $250,000 of gain from federal tax, or $500,000 if married filing jointly, if you owned and lived in the home as your main home for at least two of the five years before the sale. If you lived there at least two years and then move out and rent it, that window generally closes about three years after you move out. Members of the uniformed services on qualified official extended duty can suspend the five-year period for up to 10 years, which gives military families more time. Depreciation you claimed, or could have claimed, while it was a rental is generally taxed when you sell, even if the rest of the gain is excluded.

A 1031 exchange. If you sell a home you've held as a rental and have a gain, you can explore a 1031 exchange, which lets you defer the tax by reinvesting in other investment real estate under strict timelines. Or you can simply pay the taxes. It's your choice. A home you've turned into a rental can sometimes qualify for both the home-sale exclusion and a 1031 exchange, which is a conversation for your CPA.

State taxes. If you live outside Colorado while you own the rental, you may need to file a Colorado nonresident return on the rental income, and when you sell, Colorado may require part of your proceeds to be withheld unless an exception applies. Military residency rules can be complex.

The mortgage and insurance. You'll need a landlord policy once the home is rented. Tell your lender and insurer about the change.

I'm not a CPA or an attorney. Talk with a tax professional before you decide, and use your installation's legal assistance office for lease and landlord questions.

What's specific to Colorado Springs

Colorado's for-cause eviction law. Since 2024, once a tenant has lived in your home for 12 months, you generally can't simply decline to renew the lease. Selling the home, or moving back in yourself or with family, can be a valid reason, but you must give 90 days' written notice. If you think you might return to Colorado Springs or sell in a few years, plan your lease terms and timing around that.

Colorado Springs is a military town. Many families here rent while they're stationed here and buy later, and many homeowners who PCS keep their homes as rentals. We don't publish rent figures, because they change too often. See whether a Colorado Springs home is a good long-term rental for how to evaluate your home.

Taxes, HOA dues, metro districts, and insurance keep coming whether the home is rented or vacant, so include them in your numbers. See how BAH affects what a military family can afford for the full-cost approach.

A simple way to decide

  • If the home would cash flow, you have the reserve, and you're comfortable being a landlord, keeping it can build long-term wealth.
  • If the numbers are thin or negative, look at whether you can carry the gap, and for how long, before deciding to keep it.
  • If being a landlord would weigh on you, selling is a legitimate choice, not a missed opportunity.
  • If you have a large gain, check your tax timeline before you decide, so you don't lose the exclusion by waiting.
  • If you might return to Colorado Springs, keeping the home may be worth a closer look, as long as you plan for Colorado's notice rules.

What could change the answer

  • Market conditions. Rents, home values, and how long homes take to sell or rent all change the math.
  • Your next assignment. A return to Colorado Springs, or a long assignment far away, changes the case for keeping it.
  • Your finances. Your reserve, your next home purchase, and your VA entitlement all matter.
  • Tax rules. Your eligibility for the home-sale exclusion changes with time, and tax law can change.
  • The home. Age, condition, and upcoming big-ticket repairs can shift the decision.

When to talk with a professional

A CPA can explain the home-sale exclusion, depreciation, a 1031 exchange, and state taxes for your situation. Your installation's legal assistance office can help with lease and landlord questions. A property manager can explain their services and costs, and an insurance agent can set up a landlord policy. If you're PCSing out of Colorado Springs and aren't sure whether selling or keeping the home as a rental makes more sense, let's work through the real estate side of that decision together. If you're moving somewhere else, I can also help you find and personally vet a real estate professional in that market.

About the author

Weldon Hobbs is a Colorado Springs REALTOR® and co-founder of Team Hobbs Realty. He is a member of The Platinum Group, REALTORS®, Colorado Springs' #1 independent brokerage, which pairs deep local expertise with premium marketing exposure. A U.S. Air Force Academy graduate and retired Air Force veteran, he and his family made more than 10 military moves. Since 2006, he and his wife, Kristen, have bought and sold their own homes, managed a portfolio of rental properties, and guided others through their own real estate decisions. He has also helped both family members and clients downsize, where the decisions are often complex and the process can feel overwhelming. Drawing on his background as a PMP® (Project Management Professional), he helps people break those decisions into clear, manageable steps.

Since beginning his real estate career, he has ranked in the top 7% by sales volume among the more than 4,000 members of the Pikes Peak Association of REALTORS®. He works with military families, seniors and downsizing clients, luxury and premium home sellers, and people relocating to Colorado Springs. He developed the Life → Wealth → Real Estate™ method, hosts the national YouTube channel Life & Real Estate Without Regret, and holds an MBA along with the SRES® (Seniors Real Estate Specialist®), MRP (Military Relocation Professional), and Certified Financial Coach credentials. More about Weldon

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