How To Estimate Market Value for Rental Units

Question

Hello everyone,

My husband and I are new to real estate investing, and we are in the process of purchasing our first rental property. In order to set the rent to an appropriate amount I want to compare our property to similar properties in the area, but I am unsure of how to do so.

Any advice would be greatly appreciated!

Thanks,

Hannah

Dorothy Butala · Answer

Hi Hannah, welcome to the never boring world of rental property ownership!  The way I set my rent is by researching the "competition" in the area.  Go on Craigslist and Zillow and look for similar properties in your area, and by similar I mean, same amount of beds and baths, updated or dated, parking situation and amenities like washer/dryer included. Keep in mind what utilities you will include vs what the tenant will pay for, as well as any services you may provide like landscaping and snow removal.  You can also check out rentometer.com and put in how many bedrooms your property has, the address, and the rent you think it should be, and it will give you some feedback about rental data in the area.  Lastly, you can call a property management company and ask them what they would rent the property for, they may or may not give you an answer, but it is worth a call. I hope this helps!

Hannah Kingslien · Answer

@Dorothy Butala

Great, thank you so much for your help!