How do you determine how much rent to charge for your property?
Are there resources in your own area where you can research what to charge if you decide to rent out your house?
Yes, local realtors are very helpful. Also websites such as Trulia and Zillow are great resources.
Yes, You should be able to get the information from your County clerks office to compare the properties and prices for your area.
When I was a property agent (did it part time to supplement my income), we contacted the Rent Assessment Board, don't know what it's called in the US. But each area comes with a property value and you need to know what your area is worth. They will give you a price range to work will and help you with laying out a lease agreement. After that you can determine the amount you will charge based on the amenities you offer. This service is free in my country so I don't know if it is free in America.
Supply and demand rules. Real estate and rental agents use "comps" (comparative prices for any specific location) to see what the traffic will bear. Using those as a guideline, jot down your pluses - those features that put you ahead of the competition. Do your own homework...check ads, Craig's list, tax records, but in the long run, it's better to lose a few bucks and rent to a reliable person than to go for the gold and miss out on income for several months.
There are important things to consider when pricing a rental property. Obviously, the area's "average rental amount." Condition, # of rooms, property/yard, access to conveniences, (e.g, shopping, beach, schools, playground) Surrounding neighborhoods is a big one, here where we are.......
We include electric and water in our rents, so that changes what you ask in rent as well.
You would start out with a basic rental cost, and from there, go through all of the above, plus others I didn't mention....and adjust the rent from there.
Sure, you can use professional or expert resources, but quite frankly, it's not necessary.....and I doubt if they would provide this service free of charge.
It is a common sense process that any rational adult can handle easily.
Check your local newspaper or online rental sites for similar propertys, comparing #bedrooms, #bathrooms and approximate square footage, in a similar area. Bills included/ not included etc. Charge similarly, a little less if you want to rent it faster. Consider additional pet deposits, will you allow smoking? promote amenities such as central air etc.
Great Question! I had heard someplace (long ago, probably before all of the websites etc. recommended here) that the rent should be about 1% of the value/month. A $100,000 house would rent for $1,000 per month. That could vary with market conditions and the value of the house. Expensive houses may not get 1% ($300,000 may be hard to get $3,000/month). Lower priced house may be able to get more ($70,000 house may be able to get $800 or $850/month).
With the housing market the way it is, a lot of people of dealing with this. People can't sell their house have to rent it out for whatever they can get. Others buy foreclosures at a deal, fix them up and get a better rent for them.
You have some very good answers here. Basically we charge a rent comparable to whatever similar homes or apartments in the neighborhood are renting for. The Quapaw Quarter of Little Rock is a mix of 19th and early 20th Century homes with a few new homes replacing old ones devastated by a tornado. Houses in that neighborhood appraise from the $2,000,000 Empress Inn, a world-class B&B to some Urban Renewal apartments from the 1960s next door to our modest duplex. It makes finding real estate comps nearly impossible, so we rely on the classifieds in the newspaper and some word-of-mouth.
When we were rehabilitating that shack of duplex into a neat little Queen Anne, a real estate agent stopped by and ask what our rent on each apartment would be. When she learned the price of the larger apartment (1,000 sq. ft.) would double, she said I would neve get that much. I got that amount until the fall of the real estate market. I have now reduced the price by $50.00 per month and have no problem getting it. I guess my point is to compare potential rent with your expenses and don't let anyone discourage you from trying. I do agree that it is better to get less from a good renter than more from a bad one. A bad tenant who tears up property can cost you thousands of dollars in a couple of months. I have taken one house near the university off the market because the neighborhood has run down and it attracts only undesirables. It is cheaper for me to let it sit until a college student wants to rent it.
Look at what similar rentals are charging in your area. Size up the apartment based on your competition.
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