Keep the Virginia House, Rent It, Buy the Next One
Program and regulatory figures verified September 19, 2026. Details change; confirm your scenario with us.
In a state where values rose in every metro this year, holding the departing home means holding something that is gaining. The rules for doing it are the same in every county.
Why this structure is worth a look in Virginia
Not because the market forces it. Virginia's marketing times are short enough that most owners could simply sell. The case here is different: every Virginia metro tracked rose in value over the year to August 2026, from 0.2% in the Washington DC area to 4.9% in Staunton, 3.7% in Blacksburg and 3.6% in Roanoke.
So the question is not "how do I escape a slow sale". It is "do I want to keep an appreciating asset while I move". That is a genuinely different reason to convert, and it deserves to be evaluated on its own terms rather than as a fallback.
One framework, every county
Virginia is refreshingly simple here, and it is the mirror image of how the state handles tax relief.
Va. Code § 55.1-1201(A) provides that the VRLTA shall apply to all jurisdictions in the Commonwealth and may not be waived or otherwise modified, in whole or in part, by the governing body of any locality or its boards, commissions or other instrumentalities, or by the courts. Subsection (B) applies it to occupancy in all single-family and multifamily dwelling units located in the Commonwealth.
So there is no county-by-county lookup to do. Whatever your obligations are as a Virginia landlord, they are the same in Loudoun and in Lee County.
Subsection (C) does list occupancies that are not residential tenancies under the chapter, but they are situational rather than landlord-size based: residence at a public or private institution incidental to detention or to medical, geriatric, educational, counselling or religious services; occupancy by a member of a fraternal or social organisation in a structure operated for the organisation; occupancy by an owner of a condominium unit or a holder of a proprietary lease in a cooperative; campground occupancy; occupancy by a tenant who pays no rent under a rental agreement; and certain employee occupancies tied to employment.
Note the condominium line. If your departing home is a condo you occupy as owner, that occupancy is outside the chapter, which is not the same as saying a tenant you place there is. This is exactly the kind of distinction to put to a Virginia attorney rather than to a lender.
One claim we checked and did not publish
Several widely circulated summaries state that an individual landlord owning no more than four single-family dwelling units, and not using a management company, is exempt from most of the VRLTA. We read the current text of § 55.1-1201 and that exemption is not in it. It may describe superseded law.
Because a wrong answer here would change how someone structures a tenancy, we are not repeating it. If you have seen that claim elsewhere, confirm it against the current statute with counsel before relying on it.
What changed federally in September
Fannie Mae restructured rental income policy in Announcement SEL-2026-08, dated September 2, 2026, mandatory for all loans with application dates on and after November 1, 2026. Departing residences are governed by B3-3.8-05; the content formerly at B3-3.1-08 has moved.
Lease agreements are not permitted for any departing residence. Market rent must come from a complete appraisal including market rents, a Form 1007 comparable rent schedule for the occupied unit, or a market analysis tool supported by at least three comparable rentals.
The calculation is gross market rent times 75%, with the remaining 25% absorbed by vacancy and maintenance, less that property's full PITIA. A positive result offsets the departing residence's own payment. It does not become qualifying income. A negative result goes into your debt ratio.
Six months of PITIA reserves apply on the vacated property where the borrower has less than 12 months of property management experience. Detail on the Form 1007 page.
The local tax interaction
If you receive local real estate tax relief on the departing home, that relief attaches to a qualifying owner-occupied dwelling. Converting the property to a rental changes its character, and because the program is a local ordinance the consequences are set locally. Your commissioner of the revenue is the right office to ask before the change rather than after.
Compare this structure against the alternatives on the structures page.
Local relief ordinances, recordation treatment of a specific instrument, and landlord obligations are legal and tax questions. Your commissioner of the revenue, your CPA or a Virginia attorney, and your closing agent own those answers. We flag them because they change the numbers we underwrite.
Frequently asked questions
Does Virginia's landlord-tenant act apply everywhere in the state?
Yes. Va. Code § 55.1-1201(A) provides that the VRLTA shall apply to all jurisdictions in the Commonwealth and may not be waived or otherwise modified, in whole or in part, by the governing body of any locality. Subsection (B) applies it to occupancy in all single-family and multifamily dwelling units.
Is there a small-landlord exemption from the VRLTA?
Not in the current text of § 55.1-1201. Some published summaries describe an exemption for an owner of no more than four single-family units who does not use a management company; we read the statute and that provision is not present. Confirm any such claim against the current statute with a Virginia attorney before relying on it.
Can I use a lease to document rent on my departing Virginia home?
Not for applications dated on or after November 1, 2026. Fannie Mae B3-3.8-05 states that lease agreements are not permitted for any departing residence. Market rent must come from a complete appraisal including market rents, a Form 1007, or a market analysis supported by at least three comparable rentals.
How much rental income counts from a departing residence?
Gross market rent times 75%, less that property's PITIA. A positive result offsets the departing residence's own payment rather than adding to qualifying income; a negative result is included in your debt ratio. Six months of PITIA reserves apply where the borrower has under 12 months of property management experience.
Mike Certo · NMLS #260555 · Cornerstone First Mortgage NMLS #173855 · Equal Housing Lender. Educational content about financing, not a loan commitment and not legal, tax, or real estate advice. Local tax relief ordinances, recordation treatment, and landlord obligations change and depend on your facts; your commissioner of the revenue, your CPA or a Virginia attorney, and your real estate agent each handle their own part. Loans are subject to borrower and property qualification.