Is a 600 sq ft 2/1 too small for a Rental?

Jacksonville, Florida
Real Estate Deal Analysis & Advice
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Is a 600 sq ft 2/1 too small for a Rental?

Pedro GuillenPro Member
Rental Property Investor · Oxnard, CA · Member since 2018 · 55 posts · 9 votes

Hello everyone,

Came across a decent deal 2/1 home but it is only 600 sq ft, is this too small for a rental?  Any thoughts or bad experiences anyone has had with a property of this size.

Thanks, appreciate any feedback
 

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Bruce WoodruffPro Member
Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
8mo

In today's world that might be a gem! People love the 'small-house' concept...and easier to heat/cool/clean as well.....

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  • Erik EstradaBusiness Member
    Lender · Member since 2022 · 6k+ posts · 1k+ votes
    9mo
    Quote from @Pedro Guillen:

    Hello everyone,

    Came across a decent deal 2/1 home but it is only 600 sq ft, is this too small for a rental?  Any thoughts or bad experiences anyone has had with a property of this size.

    Thanks, appreciate any feedback
     


    On the bright side, you can still finance it on a DSCR loan. Most lenders will allow 500 sqft minimum.

    It could be that most of the value is coming from the land itself, and not the structure. 

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  • David Hedges
    Investor · Crown Point, IN · Member since 2014 · 177 posts · 84 votes
    9mo

    I have 2 units that are a little bigger than that, but not by much. Both are basically just the same issues you'd have with any other property.

    1Reply
  • Sean King Jr.
    New to Real Estate · des moines iowa · Member since 2025 · 12 posts · 4 votes
    9mo

    It really depends on your market. I'd say shoot for it smaller house easier upkeep and a lot cheaper to maintain. Find you a long term tenant or short term it depending on where your at. 

    1Reply
  • Pedro GuillenPro Member
    OP
    Rental Property Investor · Oxnard, CA · Member since 2018 · 55 posts · 9 votes
    9mo

    Thanks for the feedback, really appreciate it all your comments

    1Reply
  • David F.
    Member since 2018 · 113 posts · 136 votes
    9mo

    I'd buy it if it were a good deal, it's a bit small, so I tink you'll pull a bit less rent than 700-900 sq ft houses, which there are a lot of in my area. My REI mentor owns mostly 700-800 sq ft 2/1's and he says his tenants usually stay a really long time. Mostly because they can afford rent is my guess. Also lower cost to repair per square foot. Yes it's small, and wouldn't buy smaller, but I would move forward if it's a good deal

    1Reply
  • Ken M.
    Investor · Get yourself trained before doing something inadvisable. · Member since 2024 · 3k+ posts · 1k+ votes
    9mo
    Quote from @Pedro Guillen:

    Hello everyone,

    Came across a decent deal 2/1 home but it is only 600 sq ft, is this too small for a rental?  Any thoughts or bad experiences anyone has had with a property of this size.

    Thanks, appreciate any feedback
     

    That's small, but you have to factor in several things. It's obviously an older house, so how much will you be spending on repairs? is it sewer or septic, if septic when was it inspected last, will you have to connect to city sewer during your ownership. Is it the average size house in the neighborhood. Are you looking for cash flow or appreciation. Won't be a lot of appreciation. Is it insulated and are the windows good, what type of heat. And the list goes on. Depending on the answers, your target audience will be slim as it is, you don't want to get slimmer.
    1Reply
  • Mike Kirby
    Rental Property Investor · New Braunfels, TX · Member since 2021 · 290 posts · 257 votes
    9mo
    Quote from @Pedro Guillen:

    Hello everyone,

    Came across a decent deal 2/1 home but it is only 600 sq ft, is this too small for a rental?  Any thoughts or bad experiences anyone has had with a property of this size.

    Thanks, appreciate any feedback
     

    We have a 580 sq ft cabin and use it as a STR. It is our most profitable rental property! All the rest are long term rentals. So, it just depends on location, location, location...
    2Reply
    • Jay HinrichsBusiness Member
      Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
      8mo
      Quote from @Mike Kirby:
      Quote from @Pedro Guillen:

      Hello everyone,

      Came across a decent deal 2/1 home but it is only 600 sq ft, is this too small for a rental?  Any thoughts or bad experiences anyone has had with a property of this size.

      Thanks, appreciate any feedback
       

      We have a 580 sq ft cabin and use it as a STR. It is our most profitable rental property! All the rest are long term rentals. So, it just depends on location, location, location...

      I like these small 2 and 1s for rentals so cheap to maintain flip side  probably not a ton of up side but for long term ownership and cost to maintain I like them personally.
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  • Brian Cauldwell
    Lender · Springfield, MO · Member since 2023 · 109 posts · 78 votes
    9mo

    I closed several loans for borrowers with that square footage. As long as the lot isn't huge and there are other comps around the property of the same size, it should be no issue. 

    1Reply
  • Ashish AcharyaBusiness Member
    CPA, CFP®, PFS · Sarasota, FL · Member since 2017 · 5k+ posts · 3k+ votes
    9mo

    @Pedro Guillen

    Ditto to what Ken said above, I don't think size matters if it's a good investment, but all of those factors are things to consider, and along with repairs, systems, and overall condition, you'll also want to understand what's deductible from a tax perspective. The IRS does not care about size only that it is a legitimate income producing property. You still get depreciation plus deductions for repairs, interest, HOA and operating costs.

    If there’s room to improve how the space actually works, like adding a second bathroom, better storage, or cleaning up the layout, it may be worth renovating a bit. If you’re planning to hold the property for a bit, those upgrades can pair well with a cost segregation study. Just be careful to separate repairs from improvements, and run this by your CPA to see whether losses will actually benefit you under passive loss rules.

    At the end of the day, like others said it’s still like any other rental, if the bones are good and it’s a good deal, it might be worth it. And since you’re in Jacksonville, which is a strong market for short-term rentals, there could be additional upside depending on zoning and your overall tax strategy. Good luck and happy to connect!

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  • Fulton Abraham Sanchez
    CPA| New Clients Welcome| 50 States · Member since 2016 · 440 posts · 97 votes
    9mo

    @Pedro Guillen, hi. A 600 sq ft rental can work, but it limits your tenant pool and usually comes with higher turnover and rent caps compared to larger units. The deal should be underwritten using true comps for similar-sized properties, with extra caution on vacancy and exit strategy. If the numbers still work conservatively, the size alone isn’t a deal-breaker.

    1Reply
  • Alex Morales
    Member since 2026 · 97 posts · 57 votes
    9mo

    @Pedro Guillen - adding a different perspective here on the tenant side.

    600 sq ft 2/1 is actually a sweet spot for several tenant profiles in Jacksonville:

    1. Young professionals (single or couples without kids) - they often prefer smaller, more affordable units close to downtown or employment hubs. Less space = less to clean/maintain for them.

    2. Retirees downsizing - many are moving to FL specifically looking for smaller, manageable spaces with lower utility costs.

    3. Students or military (Navy is big in Jax) - they're not looking for space, they want affordability and location.

    The key questions I'd focus on:

    - What's the price per square foot compared to similar rentals in that neighborhood? If you can charge $1.50-2/sqft instead of $1/sqft on a larger unit, the numbers may actually work better on a $/sqft basis.

    - Is the layout functional? A well-designed 600 sqft with good storage can feel much bigger than a poorly laid out 800 sqft.

    - What's the neighborhood like? A small unit in a desirable area (Riverside, San Marco, etc.) will rent faster than a bigger unit in a less desirable spot.

    - Can you bill separately for utilities? Small units with included utilities tend to attract tenants who don't care about conservation - your costs go up.

    The real answer is: 600 sqft isn't too small if the purchase price and rent projections make the numbers work. I've seen plenty of smaller units perform better on a $/sqft cash flow basis than larger ones.

    What's the asking price and expected rent? That'll help evaluate if it's actually a "decent deal."

    2Reply
  • Chris Grenzig
    Property Manager · Orlando, FL · Member since 2016 · 479 posts · 277 votes
    8mo
    Quote from @Pedro Guillen:

    Hello everyone,

    Came across a decent deal 2/1 home but it is only 600 sq ft, is this too small for a rental?  Any thoughts or bad experiences anyone has had with a property of this size.

    Thanks, appreciate any feedback
     

     @Pedro Guillen if it's in Jax, then should be fine. Might be slightly harder to rent than more standard sized 2 bedrooms, but we have a property we own with a 2x1 garage apartment that is 700 SF and that was no different than anything else we manage/own. 

    The "bad" is you'll probably have higher turnover than a larger 2 bedroom unit or house since most people at some point will want additional space. The person with the 600 SF 2 bed might just be 1 person or a couple who needs an extra room for home office, gaming room, small child's room or something like that. However, if it is a small family with a small child they will almost certainly need more room at some point, if its a young couple with no kid they might want to start a family soon and find somewhere bigger, or if its a single person they might meet someone soon and need more space. 

    Conversely, you could find a single person who stays single and just likes the space better than a 1 bedroom option. But if I go by my gut, I would guess that on average you would experience some additional turnover versus a 2x2 house that is 900-1,000 SF or something like that. 

    For context, we've bought 150 units of small/mid sized multifamily in Jax, we still own 51 units, and we manage for other owners in the market as well. 

    1Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    8mo

    In today's world that might be a gem! People love the 'small-house' concept...and easier to heat/cool/clean as well.....

    3Reply
  • Jill F.
    Investor · Akron, OH · Member since 2016 · 2k+ posts · 4k+ votes
    8mo

    I have a 2/1 that is slightly smaller than that. It rents fine it just won't command as much rent (in this market) as a larger 2/1 unit would get. It gets about the same rent as a similarly sized 1 one bedrooms.

    0Reply
    • Ken M.
      Investor · Get yourself trained before doing something inadvisable. · Member since 2024 · 3k+ posts · 1k+ votes
      8mo
      Quote from @Jill F.:

      I have a 2/1 that is slightly smaller than that. It rents fine it just won't command as much rent (in this market) as a larger 2/1 unit would get. It gets about the same rent as a similarly sized 1 one bedrooms.

      With a smaller property, do you still have the same repair costs? Appliance repair, occasional windows, siding, roof, porch, grounds upkeep? It is more than 10% in cost savings on cap ex?
      1Reply
    • Jill F.
      Investor · Akron, OH · Member since 2016 · 2k+ posts · 4k+ votes
      8mo
      Quote from @Ken M.:
      Quote from @Jill F.:

      I have a 2/1 that is slightly smaller than that. It rents fine it just won't command as much rent (in this market) as a larger 2/1 unit would get. It gets about the same rent as a similarly sized 1 one bedrooms.

      With a smaller property, do you still have the same repair costs? Appliance repair, occasional windows, siding, roof, porch, grounds upkeep? It is more than 10% in cost savings on cap ex?

       Our business model is value-add so in that property we did a complete remodel at first vacancy. At purchase It already had new roof, gutters, and furnaces but everything else including windows were trash. We spend about 30-40% less on those particular properties  than we do on on our 1100 sq ft 2/1.5 central air townhouse remodels. I don't expect any additional capex on that property in the near term. Once our properties are renovated, repair expenses are about the same across properties, and tend to be more tenant specific than property specific. 

      1Reply
  • Patricia Steiner
    Real Estate Broker · Hyde Park Tampa, FL · Member since 2019 · 2k+ posts · 3k+ votes
    8mo

    Spend some time looking up micro-apartments and mini-houses...they work - but the location is the difference between having great cash flow and having tenants wanting out of the lease because it got even 'smaller' once the moved in. Urban areas are the best that offer a lot of walkability to bars, restaurant, shopping.  I purchased a quad that was about this size per unit in a great location - and it was hard to lease because while the location was great, new apartments were renting at a deep discount and had tons of amenities.  

    1Reply
  • Matthew Paul
    Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
    8mo

    I love smaller houses , 1 or 2 bedrooms . They cost less , less to maintain , and yes they rent for a little less , but these are my cash cows . 

    I am currently doing a turn over on a 700 sq ft 2 bedroom . In one day 2 of us painted the entire house , including cutting in the trim . And did some cleaning .  1 more day and its ready 

    3Reply
  • John MorganPro Member
    Rental Property Investor · Grand Prairie, TX · Member since 2018 · 2k+ posts · 2k+ votes
    8mo

    My best rental is a 700 sq ft 2-1 in the hood that rents for $1500/month in Texas. Big demand for small cheap rentals!

    3Reply
  • Mike Kirby
    Rental Property Investor · New Braunfels, TX · Member since 2021 · 290 posts · 257 votes
    8mo

    Ours has 200 feet of river frontage, and river frontage is going for around $5,000 to $6,000 a linear foot. We bought it for $1,000 a linear foot in 2016. We make enough on VRBO and Airbnb to pay for the taxes on that property, our primary house and the rental house next-door to our primary house. Absolute gold mine🤑

    2Reply
  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 13k+ posts · 9k+ votes
    8mo

    Depends on the market.

    In Tokyo, it would be in high demand!

    In rural Texas, probably sit for months and you'd have to keep dropping rent.

    How many comparables can you find?

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  • Nicholas Cokas
    Member since 2021 · 82 posts · 79 votes
    8mo

    @Pedro Guillen — the math is actually your best friend here, and nobody's run it yet so let me do it.

    The thread consensus is right: smaller unit, slightly less rent, higher turnover risk. But here's what that actually looks like in numbers:

    Assume a 600 sqft 2/1 in Jacksonville rents for $1,100-$1,200 (conservative). A 900 sqft 2/1 nearby might pull $1,350-$1,450. You're giving up ~$200/month in rent. But CapEx on the small unit runs 30-40%

    less (Jill confirmed this above from direct experience). On a $1,200 rent property, if you're budgeting 10% for CapEx = $120/month, the smaller unit is realistically $75-84/month. You just recovered $36-45/month of that rent gap in CapEx savings alone — before you factor in lower purchase price.

    The real question is what you're paying per door. If the price reflects the size, the deal can still pencil. If someone's trying to sell it at 900 sqft comp pricing, walk.

    Two more things specific to Jacksonville:

    1. Military tenant base — NAVSTA Mayport and NAS Jax put 37,000+ military personnel in the metro. A single sailor or junior enlisted couple doesn't need 1,000 sqft. They need affordable, low-maintenance, and close. 600 sqft is exactly that profile, and military tenants often have BAH covering rent + longer-term orders keeping them stable.

    2. STR optionality — Jax's STR market is legitimate. If LTR underperforms, a well-located 600 sqft 2/1 has a realistic Airbnb/VRBO fallback, especially near the beaches or downtown. That's an exit valve most

    3/2 houses don't have.

    Size alone isn't the kill shot. Price-to-rent ratio and tenant profile are. What are they asking?

    2Reply
  • Henry Lazerow
    Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes
    8mo

    I have a 4 with small units they are almost never vacant. As long as priced a little below the other 2brs the lower sq ft ones are actually even hotter demand. I am a big fan of smaller affordable rentals in great areas. 

    1Reply
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