How to determine rent prices for tenants

[Jack Woodward]

How do you determine what to charge tenants when you have not paid off the property? Is there a certain ratio that should be between the amount of the mortgage and the amount the tenants should pay? I’m sure this has a pretty simple answer, but I am very new to BP and still learning a lot.

[Erik W.]

Whether you have debt or not is irrelevant. You should be charging fair market value (FMV). Tenant do not care if you have debt or own free and clear. In fact, they shouldn't know that piece of information unless you volunteer it. If they want the place, they pay the rent, period. The way you learn FMV is by doing research on your competitors. Get on Zillow, Zumper, Craigslist, and drive around and call on "For Rent" signs within 1/4 mile of your property.