I'm gonna jump straight into it...
So, talking to my Grandmother while visiting her last week, she mentioned to me that she is having a hard time renting her house out in Jackson, MS. I don't know any details as of yet but it belonged to my Great Grandmother and Im more than positive there is tons of equity in the place.
Id like to know options, would love to hold on to it... Maybe offer a small down, and lease to own. If not, i may keep options open. I can get a few more details within a week.
Without knowing more details it is hard to say what to do. I will say that you should look into why is it hard to rent? Bad area, no jobs? Not a high rental market vs home ownership? To high of rent? Needs repairs? I don't know much about the Jackson, MS area though so take that for what it is worth.
I would start out by learning the area. Learning what comparable rentals are renting for. Learning more about the property and property management if you are in California and the property is in Mississippi.
Once you know all of the details on the property as far as fair rent, condition of property, property management (if needed) costs and services then I would look at if it makes sense to try and buy it.
Since it was your great grandmothers home it could be tricky. We only have two rentals and we have no connection to them. They are nice homes but we have no emotional connection to them. If a renter puts a hole in the wall then we will take it out of the deposit, if the house is messy then oh well, they are not breaking the lease. This being said our renters are very clean and have taken very good care of the homes.
We personally would not rent out our personal home that we live in now because it is where our daughter was born, we have great memories here. We landscaped the entire front yard. We would be devastated if we rented it and the tenant let it go. We remodeled bathrooms and we would not want to see them destroyed....not saying they would be but a renter will not treat your great grandmothers home like you would.
Hope this helps. Get more information and keep us posted!
@Adam Smith Thanks for the quick reply!
Great advice and starting points. I'm new to all of this and it can be a little overwhelming I'm sure you know.
Again thanks and I will try to keep updating this post the more info I find
@Ryan Blake I have two properties in Jackson I have found that they are not hard to rent out if the property is in a good area and has good marketing. Let me know if I could help.
hey @Tim White , thanks for reaching out and sorry for the late reply. Let me get some more info on the property and get back to you.
Any more details? Property address? I'm curious to the location and age of the property?
Hi @Ryan Blake ! Let me see if I can help without knowing too much and point you in the right direction...
To determine value, try looking online at other properties in the area that have sold on Realtor.com, Zillow.com, etc. Try to find a property built in the same year, same # of beds/baths, same features and updates, and within 20% up or down of the square footage. If you can get an average of price-per-square foot for properties within a quarter mile of yours, just multiply that by your square footage and you'll have a pretty decent estimate of the property's current value.
Depending on how much equity you have, you could sell it and get all of it, keep it and have the renter pay the mortgage off over time, or pull out some equity to invest in other properties. Just make sure you don't pull out too much... you'll want to make sure the property is cash-flow positive because over time you'll have expenditures for repairs, vacancies, etc. and you don't want to have to come out of pocket for those if you don't have to.
If not rented and you want to hold onto it, you'll need to determine if you want to make any improvements to the property before renting it. The main thing you'll want to consider is the cost-of-improvement vs. increased rent.
For example, if you could put $15,000 into a new kitchen and some cosmetic updates and it allows you to rent for $300 more per month, you'll recoup the cost to make the improvements in just over 4 years and get another $3,600 rental income per year after that.
To find out what properties rent for in the area, you can try looking on Craigslist to see what other landlords are asking and compare your property's features, size and location to theirs. Also, you can try using Rentometer.com and it will give you a rough overview of the rents for the area.
Ultimately, it would be best to find a local real estate professional or investor in the area that can act as your boots on the ground. Real estate is hyper-local, and all of us here in Sacramento likely have little idea about the market and neighborhood in Miss. Try posting in their forum.
One thing that also may help is finding a local property manager in the area to work with. They will definitely know the local rental market, and probably have resources for repairs and other resources you may need to keep you property up and running.
Hope that helps! Come back once you know more details about the property and we will be able to advise you further.
@Ryan Blake in my experience there are just two reasons a house does not rent . It is either in too bad of condition or the asking rent is too high assuming the person is marketing the home correctly
@Brett Chaponot Sorry for the long wait, the wife wouldn't allow any business this trip lol (Anniversary) Will email you shortly about this coming week. Thanks again for reaching out!
@Wes Blackwell thanks for the insight, will definitely utilize some of those tools in the long run.
@Gordon Cuffe you could be right, still getting more info. grandmother is kinda slow at things and i haven't seen pictures or the physical property myself.
@Ryan Blake , if you have the address, you can probably get a decent picture of the property using the Google Maps street view. That might give you an idea of what you're working with until more detailed pictures come along.
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