How much rent should I charge

Question

Allen Clark · Answer

Start high and then drop. In Seattle if I get great response to an ad it means I under priced. Ideally I want 3-4 people calling off an ad. Too much more than that and I pull the ad and raise the price.

Penny Clark · Answer

@Jim Mcmillen,

Rent-o-meter is okay, but it also compares apartments in area with SFH - not the same thing to many potential renters. Craigslist is not always reliable; Many rentals advertised there are owned by mom and pop landlord types who may not have researched current market rent and so their property may be priced below market. I would do an internet search of homes for rent in the same zip code of subject property's location. The results should show ads that are placed by property management companies and realtors who have done the research. I would also look at supply and demand for rentals in your area. Doing so will help you determine what the competition is in your market (Are there only a few or is it saturated?)

Once you know what the going market rate is for a home with the same amenities, you'll want to see how fast they rent at that price. If you're in a hot renter's market, a property could be posted and filled within 2-3 weeks. If you see the same type of property listed for more than a month, it may be priced to high. If you don't take the time to analyze the proper rent for the property, you will 1)leave cash on the table and 2) Attract a lower quality renter by setting the price too low.

Also, before you purchase the property, add in all your expenses to make sure you'll have some cash flow after these costs are met. From your post, it appears you'll be making your money up front in this deal already!

Good luck!

Lelith Walker · Answer

You could also go to rentometer.com, check craigslist.com, and consult a local realtor to get an idea.