I'm working with some out of state homeowners who are interested in selling a SFR in Pittsburgh. Here are the details

Price: $150,000 - Homes have sold anywhere from $120k-300k in the surrounding few blocks. Actual value is probably closer to $170-180k

Neighborhood: Nice updated 1300 sf 4/1 home located right around the corner from one of the best elementary schools in the area; high-income neighborhood;  other middle school and high school is located very close; walking distance to some shopping, restaurants, coffee shops; very safe

Rental Rate: $1,300 + utilites tenants  on a 18 month lease which expires end of April 2017. Tenants want to renew and love the location. Tenants always pay, but pay late and pay late fee of $1350

I'm trying to work with the homeowner in deciding if they should renew the lease or push for a higher rate. Here are my thoughts, I wonder if anyone shared the same or different ones. The sellers are concerned if I can't bring a buyer in, they will have to deal with re-tenanting the place and don't want to do that. If they renew, a 12-14 month lease, they can come back in the Summer 2018 to get the place re-rented. 

Renew the same rate:

PRO

They're guaranteed their $1300 income in case there's no deal. 

A third party investor will have guaranteed income in a great neighborhood that attracts long term tenants

CON

Investor may pass due to sale price being quite high relative to the income (although the property still cash flows very well if you don't take property management, vacancy, repairs, and capex)

Increase rental rate

PRO

Market could support $1,400 I think, and gets you a better return and is a more attractive deal. 

CON

If tenants can pay extra $100 a month, they're stuck looking a a new place before their lease ends 4/30/17 and the seller has to re tenant, which they very much DON'T want to do.