Just wanting to get some feedback on what people are factoring into rent. Things I'm wandering are HOA fees, certain utilities, yard maintenance? I am wanting to rent out my current house but not sure what all to include when trying to figure a rent amount.
@Corie Carpentier This is really up to you and any landlord-tenant laws that exist in your state, HOA regulations, etc. Around here, landlords typically pay for HOA fees, while tenants pay for utilities (though landlord may pay for some to the extent not separately metered in a multi-unit property) and handle the yard maintenance themselves. I would imagine these things vary from locale to locale.
Your rental amount is market driven not chosen by the investor/landlord. You need to research your market.
From a financial perspective your monthly rent should be equilivant to 1% of the value of the home as a bare minimum. If your market is not 1% or higher then the property is not a viable rental.
Expenses are generally calculated to be 50% of rental income. This does not include debt repayment or return on equity. Assume 100% financing to get a ball park on debt repayment when calculating cash flow.
You need to do a rent survey of similar units in the same area. Look on rentometer.com to get an initial idea. Look on craigslist or other local ad resources for houses in the neighborhood. Drive around and look for signs. Then start calling the available listings. Ask what they include, deposits, rent, and details about the property. From this data, figure out your rent. You need to be comparable to others in the same vicinity. That include things like utilities and lawn care. Typically for a SFR rental these are paid by the tenant. In multi-unit property lawn care is typically a landlord responsibility. Utilities may or may not be included. Maintenance is usually a landlord responsibility.
Note that your costs (mortgage, HOA fees, utilities, etc.) are completely irrelevant to determining rent. They will affect whether or not your rental is profitable. But the market sets the rent. You need to prices yours competitively to the other house that are available.
All really good points and tips. Thanks alot!
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