Here s a tough situation for a homeowner. You bought your house for $300,000 a few years ago. You owe $250,000 on the mortgage and can hardly afford to make the payments anymore. You want to sell, but values have tanked in your area and the best price you can get is $200,000.

Should you wait until values come back up and rent it out in the meantime? Unhappy with bids coming in, many homeowners have been doing just that. (In fact, last summer Treasury Secretary Timothy Geithner rented out his family s five-bedroom $1.635 million home in Larchmont, N.Y., after it sat on the market for several months.)

But this strategy doesn t always make financial sense. It can be almost as hard to rent your home as selling it, and there are costs associated with renting that you might not have considered, including insurance and management fees. Plus, if you re betting the market will recover and you will get more from a sale down the road, you might be risking too much.

If it costs, say, $9,000 to hold onto the house this year, are you sure it s going to appreciate $9,000 in the next 12 months? says John Vogel, a professor of real estate at the Tuck School of Business at Dartmouth. Given what s going on with unemployment, plus the time and hassle involved in managing a house, it s far from a sure bet.

What s more, home prices nationwide are forecast to fall more than 8% in 2010, according to data from Moody s. There s at least as good a chance that the market will be worse a year from now as it will better a year from now, says Vogel.

Despite recent signs of stabilization in the overall economy, it s still a renter s market. Rising unemployment has dampened rental housing demand and contributed to a 3.4% decline in asking rents in 2009, according to real estate investment services firm Marcus & Millichap. The firm estimates that the single-family home rental vacancy rate has risen to 10% at the end of 2009 from 7% in 1997. That s slightly down from the 10.5% it was in 2007, but it s still higher than last year s 8% apartment vacancy rate. We re at an all-time high vacancy rate for apartments as well as single-family homes that are on the market for rent, says Hessam Nadji, managing director of research services at Marcus & Millichap.

New construction is partially to blame for the supply overhang. More than 120,000 apartment units came into the market in 2009, driven by developers who had obtained financing before the credit crisis really hit, according to Reis, which tracks the real estate market. High apartment vacancy rates have pushed owners to lower rents, says Peggy Abkemeier, president of Rent.com, an online rental marketplace making apartments more attractive for at least certain types of renters. Abkemeier says that while there has been an uptick in renters seeking homes for rent on Rent.com, apartment-related searches still remain more popular than house-related searches.

You have to realize, you re not the only one with a house on your hands that you don t want to sell at the moment and want to rent out, says Janet Portman, a real estate lawyer and author of Every Landlord's Legal Guide. Assess the market and find out if houses like yours are a dime a dozen if it is, the rent you d collect might be lower than you hoped for, she says.

And because of the oversupply, in some markets it s also taking longer to find renters than it did a couple of years ago and that means lost rental income. "Now the competition is greater in the higher-end markets, and it might take four months to rent a home, whereas before you could rent one in 30 days, says George Pabst, president of Pabst Kinney & Associates, a property-management firm in Long Beach, Calif.

For frustrated sellers still intent on becoming landlords, here are a few points to consider:

* Typically, renting makes sense if you plan on returning to the home say, if you were taking a sabbatical or were being transferred for a year to another city for your job.

* You ll be getting income each month but it should cover your monthly expenses, including mortgage payments, utilities, property taxes and higher homeowner s insurance costs.

* You must pay federal taxes on the rental income but at least some of that amount could be offset with deductions for operating expenses (mortgage interest, repairs, utilities) and depreciation.

* Don t forget that tenants aren t going to keep your property as tidy as you would, says Diane Saatchi, a senior vice president at Saunders Associates, a real estate brokerage in Bridgehampton, N.Y. As much as possible, you should carefully screen prospective renters to make sure they re financially stable and good housekeepers.