can't find tenants - links included
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Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
12yIn my experience, just the opposite is true. Price it at or a little under the market and you'll have more applicants. Price it above the market and you'll get a crummy tenant. Better applicants have more choices and will choose a better priced choice. Crummy tenants have few choices and will pay a higher price.
Realize its a slow time of year. So, you're not going to get a lot of traffic.
You say its one street over from a bad area and that its priced right based on comps. Are those comps also just one street from the bad area? If not, they're not good comps. I had this problem with a house I sold. One block to the south would have been worth 5% more. One block to the west and it would have been 10-15% more. As it was - on a busy street across from a high school - the choice of comps was very limited. The proximity to a defect like this bad neighborhood can be significant. If its priced comparably to other properties that are further away, you'll have to be cheaper.
51 Replies
- Property Manager · Livonia, MI · Member since 2011 · 4k+ posts · 1k+ votes12y
Originally posted by Jon Holdman:
What would the property rent for if it was actually in the C area?that's the thing.... it would rent for 925-950 easily. they have some renting for 1k.
- Investor · PA · Member since 2013 · 1k+ posts · 602 votes12y
If you use a PM or agent they probably won't even show the house to anyone until they pay their $25 or $35 fee and filled out an application. Most people who want to rent a house will not want to go through that hassle if they can help it just to find out they don't want to rent the house anyway because they feel it is "overpriced".
- Investor · Milford, CT · Member since 2012 · 592 posts · 285 votes12y
Originally posted by George P.:
george, what is the average time it takes you to fill a vacancy?
Well all my rentals are MFH if that makes any difference. It usually takes me a good 3 months to fill a vacancy in the market i have these 2 units (2 - 2family houses). Usually I get a ton of calls and showings first 1-3wks but they are all red flagged tenants. I also don't accept smokers or pets. Then as I step up my marketing depending on who I am looking to rent for it becomes a process, again I am very picky.
I have to be very diligent, this town used to be very blue collar, heavy manufacturing and construction jobs. Renting was easy, you got a job? No problem here are the keys. But that has all gone away in the last 20yrs, luckily these are all bought and paid for. When these are available for turnover I have to make them a B class property in a C class neighborhood and try to entice B class renters from other towns into this town. This is only way I am staying afloat with these properties right now.
I plan on selling them as the market cycles out of here and invest in more growth towns down here in southwest ct. Again these are not warzones or ghetto locations. Its just that there is no growth and basically considered bedroom communities as you have to drive anywhere from 30mins to an hour for a real job.
The opposite is a 4 unit I have here in town. I put a feelers out on CL before putting any finishing touches and had it rented a week later. Last year I had a vacancy and another this year as well. Same experience.
- Investor · Milford, CT · Member since 2012 · 592 posts · 285 votes12y
Are you close to any hub of sorts? Hospitals, Schools, Gov't Offices, etc....
What works for me is also creating a property flyer and distributing in those locations' bulletin boards.
Good Luck and keep us posted. I am actually waiting on the call back from the marshalls on one eviction where they are removing a tenant sometime today.
- Investor · Willow Spring, NC · Member since 2013 · 788 posts · 285 votes12y
Originally posted by George P.:
Originally posted by Jon Holdman:
What would the property rent for if it was actually in the C area?that's the thing.... it would rent for 925-950 easily. they have some renting for 1k.
I'd rather price it to move than try to squeeze out another $50. A month vacancy vs the extra $50 x 12 = $600 per year doesn't make sense to me. You may be able to get the extra money, but waiting for it doesn't work for me. Time is money.
To me, honestly evaluating rents before purchasing and only buy when the numbers make sense, is the way to go
- Investor · Boise, ID · Member since 2011 · 1k+ posts · 736 votes12y
I echo the time of year being the biggest issue and am specifically marketing 18 month leases right now to avoid winter vacancies a year from now. I offer a small discount on an 18 month lease instead of 12, and tenants appreciate that option. Needless to say, patience and a frequent checking on the home to ensure no damage due to weather is key this month.
- Investor · Macomb, MI · Member since 2013 · 654 posts · 115 votes12y
Originally posted by George P.:
Originally posted by Jon Holdman:
What would the property rent for if it was actually in the C area?that's the thing.... it would rent for 925-950 easily. they have some renting for 1k.
If it still hasn't rented for these amounts, then it's definitely not easy.. I just had a property take me 3 months to occupy. Nice area. Nice house. Even had two people go through the whole background check just to disappear. But mostly because the people didn't fit my criteria.
It just happens sometimes.
- Investor · Macomb, MI · Member since 2013 · 654 posts · 115 votes12y
Originally posted by George P.:
i (once again) am having trouble finding tenants for my latest house.
website - http://onpointrentals.com/index.php?p=1_16
craigslist ad - http://detroit.craigslist.org/wyn/apa/4226172664.html
it has no garage, good suburb, but with C schools. older neighborhood, but one street over from a C suburb.
3 bed, 1 bath, fully updated as you can see from the pictures. basement is cleaned out, bright and painted. not finished. appliances included
started working with a new realtor and she listed it on the MLS at $1,050. had 3 showings and nothing. one commented on the proximity to the C suburb. 2 weeks later, dropped it to $995. it's priced right based on the comps.
the previous realtor was very demanding with potential tenants, so i switched. i have also had simultanious ad on CL and nothing. days go by without any action.
i know the lower i go, the worse the potential tenants would be.
George,
Here is how I handle my screening. This works well for me. I did have a hard time filling my recent property but a big factor was the people interested didn't pass my screening.
https://www.biggerpockets.com/blogs/4178/blog_posts/30113-how-to-qualify-as-a-landlord
I use postlets and rentlinx for advertising now. CL just seems to have went to the way side the past few months for finding tenants. Be careful with Zillow. People can claim your posting and try to run scams. I know this personally.
I also advertis $50-$75 lower than neighboring properties. In my experience with talking to management companies is that many over charge and I see their properties listed for months and months. I generally get a tenant within 1 month of listing the property using my process. It may not work for others but just wanted to share.
Good luck.
Oh and tonight is the Metro Detroit BP Meetup at Champps in Troy if you would like to attend. It starts at 6:30pm. Reservation is under my name. Aaron Yates.
- Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes12y
"that's the thing.... it would rent for 925-950 easily. they have some renting for 1k."
George P. do those properties have a garage??
If so I think you might have underestimated the importance of a garage in that area when renting to a tenant. Something has to be going on for them not to rent the unit. You are getting showings so there is at least some interest.
- Investor · Fort Lauderdale, FL · Member since 2012 · 1k+ posts · 465 votes12y
I also have a 2/1 in a very nice area that I have been struggling to fill...for 6 weeks months now.
I used Postlets, CL, onsite flyers...
I do get calls, mostly from desperate people who wants to move immediately. I got a call from someone from Pakistan on Thanksgiving Day and wanted to move THAT day.
Most do not pass pre-screening, I mean you don't even want to hand them the application.
But in my case, I know why. It is because I am asking three months to move in. First month's rent, last month's rent and a security deposit. I also ask for no smokers and no pets. But the big thing is no pets and 3 month move in.
Now, my other properties are SFR, and asking 3 months wasn't a big inhibitor. I figured if you can't put up 3 months, you may have problems meeting your obligations.
Checking around the same area, out of the 14 other similar properties for rent, only two other places asked for 3 months like I do, the rest are either "NO DEPOSIT" or "$499 MOVES YOU IN". Rent is competitively priced.
For me it's OK because it's a place I bought and I inherited a tenant, and this is really the first time I am able to do anything to it, so I have been fixing and upgrading a bit here and there. But now that I am done, I really need a tenant.
I am thinking of relaxing the 3 month rule, and may be allow cats. Not sure.
- Property Manager · Livonia, MI · Member since 2011 · 4k+ posts · 1k+ votes12y
yeah, garage is a big thing.... i thought i'd be ok, but i guess i messed up on this one.
but i have somewhat positive news. my realtor showed the house a month ago to her clients. his fiance said "no, bad area". then a few weeks later the guy sees our ad, calls and says "the house looks amazing online, want to see it". upon further discussion it comes out that our realtor is also his realtor and she has been unable to find them houses for a budget of 1500.
a week goes by and the couple with the realtor go back to the house to see it. a week goes by and she finally calls to tell us they want to get 2.5 yrs with an option to buy while he is repairing his credit.
a little weird how they can't find any house to their liking throughout 3-4 suburbs. for the SE detroit crowd, the suburbs that they have looked are westland, plymouth, canton and livonia. my house is on the eastern edge of livonia.
so anyway, we will see what happens... just wanted to update you. thanks for the great feedback/suggestions/observations.
- Austin, TX · Member since 2013 · 103 posts · 19 votes12y
It is too easy to say that winter is a bad time for renting. Heck, that's 25% of the year...and complaining about the weather does not help with cash flow.
Instead, be more pro-active and look to see if the house is appealing to a potential renter within the first 5-10 seconds. If not, spend some money making it more attractive cosmetically.
Then, move quickly and lower your rent a bit and move someone in with "good-enough" credit. Better to get 12 months of rent at 10% below your "hoped for" amount than 9-10 months of "best case" rent.
I just rented two houses the past 7 days. We threw in a bonus to our listing agent on one and went HUD on the other.
- Investor · Willow Spring, NC · Member since 2013 · 788 posts · 285 votes12y
Originally posted by Nick Keesee:
@Bryan H. Thanks for informing me on RentMetrics! I know of and have used rentometer.com but RentMetrics in new to me.
Do you prefer one over the other? Which one do you find to be more accurate?@Account Closed I like to use RentMetrics, Rentometer and Zillow. They all provide ranges. I average the ranges to give me a real good feel for what the place will get in rent. I believe they all pull from the same data set, so it's just how they analyze the data.
- Property Manager · Livonia, MI · Member since 2011 · 4k+ posts · 1k+ votes12y
@Robert Piller what do you mean "went hud"?
and i agree on the theory of get what you can for one year instead of best case 9 months. but my partner thinks the crowd will be really bad the lower we go with the rent..
- Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes12y
In my area this would make my units unrentable. Even asking for one full months rent and the full security deposit is difficult. Nobody asks for first, last and deposit.
What do other units in the area ask for? Start calling their ads and pretend to be a tenant and ask. If they're asking for less, this may be a significant factor. I've learned not to "work with people" on the deposit, but I also have no hope of getting the last month's rent.
- Realtor · Schaumburg, IL · Member since 2011 · 289 posts · 118 votes12ySounds like you need a broker that understands the market and KNOWS how to get an application. As a broker, it's my experience that most brokers do not know how to close and get apps; The incentive (commish) for most brokers is always lacking because they're so used to four figure checks for their work/ time. I'm not saying pay more, but brokers are typically not as motivated to move a rental compared to selling or buying a unit. If the unit shows as nice as it looks, you should be getting more leads, if not, it's because price, lack of marketing, agent performing poorly. Being December, a 3bd 1 bth typically draws in families; most families don't like to move in Dec as far as my experience has taught me, but I know they're still out there. Just wanted to drop in and give my opinion, good luck to you.
- Property Manager · Livonia, MI · Member since 2011 · 4k+ posts · 1k+ votes12y
@Christopher Leon , what's the difference between a realtor (agent) and a broker? i pay my realtors (have used 4 different ones over last two years) one months rent, and they split it with the buyers agent if needed.
- Austin, TX · Member since 2013 · 103 posts · 19 votes12y
@George, we rented through HUD..a government agency for certain lower income families. See if your city has a HUD office and talk with them.
- Multi-family Investor · Member since 2008 · 28 posts · 3 votes12y
I just rented two units and had them rented in under two weeks. What I do is list on CL (post a toll free number and website in the ad). When they call the toll free it provides details about the property and mentions that I will be showing the unit DAILY, at the same time (Mon-Sun). This seems to work well as it accommodates all schedules.
If people leave a voicemail after calling the toll free, I call them back. If they don't leave a voicemail, I gather all the caller ID numbers (since they show up when dialing toll frees) and send a follow up text message with the unit details.
- Realtor · Schaumburg, IL · Member since 2011 · 289 posts · 118 votes12y
Originally posted by @George P.:
@Christopher Leon , what's the difference between a realtor (agent) and a broker? i pay my realtors (have used 4 different ones over last two years) one months rent, and they split it with the buyers agent if needed.The difference between a REALTOR and a broker is the designation. I am not sure how it is in Michigan, but, in Illinois you basically have real estate brokers or managaing brokers (people that manage the brokerage house I.E. Keller Williams, ReMAX) As a broker, you can become a REALTOR by basically paying to get into the club to become a member of the NAR (national association of REALTORS) REALTORS are held to higher ethics and standards because they have to take extra ethics training and such, its great for any broker to get this designation and really the only designation i would suggest. All the others are just a waste of money. The saying goes, "the broker has his CMA, and GRI, but no M-O-N-E-Y" lol.
That stinks if you have used 4 different REALTORS in the past two years. Try to find one that is also an investor and knows the market, it will save you time and money! Good luck to you.
- Tinley Park, IL · Member since 2013 · 2 posts · 0 votes12y
If you are a Realtor, which is part of an association, you are a real estate broker,,,,,but doesn't mean that if you are a real estate broker you are a Realtor....
- Investor · Fort Lauderdale, FL · Member since 2012 · 1k+ posts · 465 votes12y
Originally posted by @Jon Holdman:
In my area this would make my units unrentable. Even asking for one full months rent and the full security deposit is difficult. Nobody asks for first, last and deposit.
What do other units in the area ask for? Start calling their ads and pretend to be a tenant and ask. If they're asking for less, this may be a significant factor. I've learned not to "work with people" on the deposit, but I also have no hope of getting the last month's rent.
Some do and some don't. One other rental on my street asks for first last and security.
In Fort Lauderdale the neighborhoods are very mixed and one or two streets over is very different.
Two streets over you can find $99 security and first month $995.move you in, on my street especially the corner I am in I ask for $1150 same size, first last and security, but I am in a safe neighborhood and literally 35 feet from the river.
Actually all my properties I now ask for first last and security. Two month early termination penalty.
...and this week, I have people waiting, one has no imome but willing to pay the whole year up front, another wants a 2 year lease but has two cats. The biggest inhibiting factor is pet, I must have turned away over a dozen dog owners. But if price is a constraint, I'd rather they rent two street over. I actually tell them two streets over it's 995 and went they ask why I tell them to drove around.
- Property Manager · Livonia, MI · Member since 2011 · 4k+ posts · 1k+ votes12y
quick update....
we had a low ball offer of $900 where the older guy on SSN would pay the rent. Total of 5 adults would live in the house. We declined.
I had a couple that made over 6K a month, but unverified income. both had two jobs and we approved them. but then we found out he had a 3rd offense domestic dispute or whatever it's called. when we inquired about it, he said "i will not provide any more info, backing out".
2 weeks ago we received an application from an applicant that makes $2600 (rent is 995) and has $11k in judgements against her. naturally, we declined.
Craigslist has produced very, very, very little response. maybe 1 call per week.
Trulia has produced a few people inquiring, but feel liks it's a gimmick since they just click on "contact me" and it fires an email to us. nothing substantial.
I just let my realtor go and will go with another realtor that's located closer to that house. he is the actual realtor that helped me get this house, btw.
so, we will see... days on the market is >60 right now.
- Pittsburgh, PA · Member since 2014 · 9 posts · 3 votes12y
What websites are you trying to advertise your property on? The Online marketplace could be the key to your success.
- Property Manager · Livonia, MI · Member since 2011 · 4k+ posts · 1k+ votes12y
we stuck to our price ($995 dropped it from $1050 after 2 weeks, mid november), but we found a couple that was eager and really likes the house.
she is a nanny and he works for a landscape company. no pay stubs since they are mostly cash people, so we offered them a month to month for 6 months. after that, we can do a year. i dont know... it was hard to fill up this house for the 3 big reasons (close to a C neighborhood, no garage and C schools).
i still got 1-2 calls since Jan 1, so the "holidays" excuse does not work anymore.
btw, i changed the realtor on Jan 3rd, and i am happy with this one. he is older guy.. maybe in his late 60's but hustles and follows up like white on rice.
he will get the next house. and number 11 is coming fast..
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