Under Market Rent in Puget Sound
I have had the same tenants in a home for 8 years. Over the years, I have chosen to only raise the rent a few times while rent prices in this area (outside Seattle) have skyrocketed. The home's value, according to Zillow (I know - Zillow), is approximately $500k but that is over-valued, especially as it is an older home that needs some work to the exterior concrete patios (terraced and sinking). The current rent is $1800. I moved to increase it to $2k last year, but COVID hit right at that time and I canceled the increase as I knew that part of my tenant's livelihood was going to be impacted. They have been great tenants - always paying on time (even through COVID) and treat the home well - but I could probably reasonably charge $2500 in rent for the home if I were to newly list it today. Any thoughts? I know I need to take steps to increase the rent to get back up to market, but now Washington State may "pause" that with a rent control bill for 6 months after the Governor lifts his emergency order. I'm wondering if the value of having great tenants is worth the reduced rent? Should I reconsider selling? The property taxes and home owner's insurance are eating up a huge percentage of any income and the needed repairs to the home are eating up what's left.
Most Popular Reply
@Angela Dickson, evicting tenants right now to increase the rent from $1800 to $2500 will not be possible because of the moratorium unless you are selling the house, or moving to live in it.
Is the contract for a year or month-to-month?
You will need to run the numbers of selling the house vs keeping it and take an informed decision based on the numbers.
Feel free to reach out. I am always open to more conversation over phone or coffee!