What should I be charging for rent?

6 Replies

Recently placed an ad on Facebook to rent a 2 bed 1 bath house for $600. Kind of a bad area. That is why I put the rent so low. 

My Facebook account got blown up with response. As much as 200 people responded.

I think I asked too little for rent. What should I do now?

As long as the numbers still work with 600 a month, I would find the best possible tenant out of that pool of applicants and run with them. You could always increase rent to market rates over time. I'm not sure of the laws surrounding you changing the price after its been published.

you should research your local market rents for similar properties. use Zillow, trulia, and craigslist to compare similar units. also try rent search sites like rentometer. based on your response, I would suggest starting higher than you think it should be, then adjust down every week if you do not get responses. this is how you find market rent for your property.

you said it was in a bad area. you may want to take your time picking, and try to find someone who is very qualified. a bad tenant costs a lot more than a months vacancy.

200 responses is quite a lot.  I'd do some research to confirm what the fair market rent should be.  It's entirely likely you priced it too low with that many inquiries. 

A little bit low isn't usually a problem and can often result in many applicants to select the best one from.  However, if it's far below what it should be, you could potentially be missing out on a lot of money.

So before you agree to rent it for the $600 you initially advertised it for, I'd check multiple sources to confirm you're in the ballpark.  The more sources you check the better (i.e. Craigslist, Zillow, Rentometer, local property management company, etc).

Lastly, here's a guide that might be of some help in determining what the appropriate rent might be:

THE ULTIMATE GUIDE TO FAIR MARKET RENTS

Good luck.

What did you use to arrive at that $600 price? Asking because I heard zillow's estimates (zestimates) are not very accurate as well as some other listing sites. 

@Jeffery Cass - I see that you're a licensed agent in Virginia. I would advise doing a comparative market analysis of similar rentals in the area, assuming you have access to the local MLS. With that sort of response, there's a good chance you should be asking for more.

Shy away from public websites like Zillow, Trulia, etc., as someone else has already mentioned, because the data is often inaccurate.

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