I want to rent my first house but I live in a small town with only 4000 people. Is it a bad idea to rent in this town? My house is a block away from a middle/high school. It's a peaceful town too...
It's tough to know too much without knowing numbers, but I do know the small town I work in (7,000 people) is nearly impossible to get a rental in. It's in the Central Valley of California and there's almost nothing available. Often, when something comes up, you have to know the landlord or you have no chance of getting it. Also, it seems like they rent to the younger teachers so they have a place to live in town when they otherwise wouldn't have a prayer of getting a place. If your small town is like that, I'd definitely rent it as you'll always get the best tenants without even having to advertise. If not, I can't really say. Best wishes and good luck!
Investor · Worcester, MA · Member since 2020 · 1k+ posts · 1k+ votes
4y
@Moly Yang - Not at all, I think you just need to run some numbers to ensure the house is profitable. Every city has landlords, the question is whether this deal makes sense from a rental perspective. You can utilize rentometer, BPinsight, craiglist and facebook marketplace to get a gauge for rent, put it into the BP calculator along with maintenance, capex, vacancy, and property management (b/c the ultimate goal is for this to be a passive investment) and see if its profitable. If it provides minimal profit, it might make more sense to leverage the equity into another deal. At the end of the day, I am a buy and hold investor so I am all for accumulating as much properties as possible as long as they are profitable otherwise you will be supporting that property out of your own pocket every month, which limits your growth dramatically.
It's tough to know too much without knowing numbers, but I do know the small town I work in (7,000 people) is nearly impossible to get a rental in. It's in the Central Valley of California and there's almost nothing available. Often, when something comes up, you have to know the landlord or you have no chance of getting it. Also, it seems like they rent to the younger teachers so they have a place to live in town when they otherwise wouldn't have a prayer of getting a place. If your small town is like that, I'd definitely rent it as you'll always get the best tenants without even having to advertise. If not, I can't really say. Best wishes and good luck!
Rental Property Investor · Indianapolis, IN · Member since 2020 · 562 posts · 554 votes
4y
@Moly Yang it depends on the numbers. Can you rent it out and make enough money to cover any mortgage plus expenses? Is there demand for rental houses in the area? Do some research and see what you find!