Whether you are a property manager, a seasoned investor or a homeowner looking into property management determining fair market rent is the most important first step in all of the jobs you will perform.
As a property manager sometimes it is easy to think that by being in the market for so long, you automatically know what the price should be. Or you go off the advice of your friends and family because they have a property just like yours. However, it could be on the whole other end of town. The only way to make sure you are maximizing the return on your investment and the ultimate market rent is to do a little research.
Craigslist is always a great place to start. 90% of all real estate searches start online according to the National Association of Realtors. This and other great sites like Zillow and Hotpads are a great place to compare market rents. Zillow not only lists properties for rent, they have now come out with a rent Zestimator.
This is a great way to see what is going on in your direct area. When you are out at your propeties make sure to call and see what other properties are renting for in a 1/2 mile radius. Make sure you get all of the particulars and write the adress down. When you get home you can go to your local property appraisers site and pull up the square footage and amenities to compare with your home.
Determining Fair Market Rent
The U.S. Department of Housing and Urban Development website publishes an annual report on rental rates by city/state and size of the property. This gives you a good ballpark figure but you must take other things into consideration. The property’s location within the city, amenities and whether utilities are included in the rent can all cause your rent to vary from this figure.
Whatever you decide to do make sure that your agent is utilizing all of the tools out there including the local Multiple Listing Service to determine a fair market rent for your home. At Key Real Estate we look at all of those as well as the several hundred properties that we manage to make sure you are getting the highest return on your investment. For more information call us or check out our website.