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Old 10-06-2011, 08:32 PM
 
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I am looking to rent a house in the Dallas, TX area. There are a lot of houses for sale that have been on the market for several days and I would like to see if any of the owners would be interested in leasing. My question is there a reasonable way to calculate rent based on the homes for sale value?

Appreciate any input in this area. Thanks in advance
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Old 10-06-2011, 11:24 PM
 
Location: Seaford, Delaware
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The best way is to look at comps that are already rented. What is the rent for a comparable house in the neighborhood. The sales price would have little effect on the rental value. Except to expect to pay more rent for expensive houses.
Look at listings in the neighborhood for the same kind of house and see what it rents for. go from there.
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Old 10-07-2011, 06:20 AM
 
Location: The Triad (nc)
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Quote:
Originally Posted by thinkerbell View Post
My question is there a reasonable way to calculate rent based on the homes for sale value?
Not really.

The people who are actually looking for tenants (landlords) have their own cost basis and other operating factors... but the real arbiter of rent amount is what the rental market allows in any given area.

otoh... The people who are actually looking to SELL would be well advised to NOT clutter up that mission or the house by taking in tenants at all.

hth
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Old 10-07-2011, 05:46 PM
 
Location: Boise, ID
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I wouldn't think very many people with houses that have been on the market for "several days" would be looking to put a renter in there, unless they have the house overpriced, and don't expect it to sell for a while, or a short sale, that might get an offer quickly, but take a while to close.

As someone working a desk in a property management/real estate office, I would say that if we had an owner who wanted to do this, and expected the house to take a while to sell, I would be looking for a tenant who came with very high recommendations from someone I trusted, have immaculate credit, an immaculate rental history, or if they hadn't rented before, but had sold a house, I would want to speak with their real estate agent who sold their house.

A tenant moving into a house that is being sold has to be ready and willing to keep the house in showing condition 24/7, and has to be willing to let agents come through on a moment's notice. If an agent knocks on the door saying they were driving by with a client and saw the sign and were interested, the tenant has to be ready to leave the house and let them look. (Of course, checking photo ID, getting a business card, and calling the agent's office to confirm they work there, are all good idea to do first for anyone who doesn't have a lockbox key with them.)

Also, right now you will find that many houses listed for sale are bank owned. The banks will almost always say no to putting a tenant in while listing the house, so that limits your choices substantially.

Finally, a tenant in a house that is for sale would have to be ready to move on short notice, and would be on a month to month, or possibly even week to week lease.

It definitely isn't the most convenient thing in the world.
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Old 10-07-2011, 05:54 PM
 
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To add to Lacerta's good points is that if you have a lease, the new owners are bound by that lease. So if they are buying because they want to move in, in most states, they are forced to honor the lease until expiration and that dwindles the pool of buyers.
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Old 10-09-2011, 08:44 AM
 
Location: Bar Harbor, ME
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I actually sold my house. But for awhile I didn't I thought of renting it.

However, if it was rented for too long, and I wasn't in it, then it would no longer have been my primary dwelling for three of the previous 5 years, and thus when I did sell it, I would pay a monstrous capital gains tax. Plus, I would have had it damaged by the renters so that I would have to do more renovation to sell it. Renters rarely take good care of houses they don't own.

And moving back into it would have been a nightmare, since the other hosue was 600 miles away.
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