Price of a Rental in Durham (low income, section 8, crime)

[sll3454]

When our house in N Durham became available we made some improvements, lowered the rent $50, and listed it for $1300, thinking that it would rent quickly.

Our target tenants:
-Someone looking in the $1300 - $1500 range who would prefer to spend less than they could and maybe build their savings
-Duke resident or professor
-Nurse at one of the area hospitals, preferably one who has a spouse also earning money
-Family looking for safe area (Durham crime mapper) and good schools

Who's looking and applying:
- people in the $900 - $1100 range
- unemployed people
- people who already have spent much more money than they've earned and have a habit of not paying it back (Yikes! Unbelievable credit reports! But they all drive nice cars.)
- people who don't mind lying to us, both in person and on the application (Um, no, that person is not your landlord, and the real owner of the house is pretty upset with you now.)
- multiple families wanting to live together
- people on Section 8

Of course they all love the house.

The people already living in the neighborhood are a mix of professionals and successful blue-collar. Professors, teachers, business owners, retired folk. No multiple families. It's racially mixed, quiet, safe, full of mature trees, and loved by all who can't afford it.

Should we have priced it higher so it wouldn't be overlooked by those who could afford it?

Do people in the area generally assume a house is priced $100-$300 higher than you really want? We thought we were offering it at a good price.

Is $1300 (in Durham) some sort of awkward place between those who can pay bills and those who can't (won't)? I don't think we've priced it too high, because the previous owner was able to find someone to pay $1350 - before improvements.

[North_Raleigh_Guy]

I think you have simply discovered the joys of becoming a landlord and the challenges associated with finding "good" tenants. Good Luck!

[mia78]

I think the problem is that in this economy, your target tenants are trying to find something cheaper. Many families that used to be dual income are possibly single now or their spouse has had a significant portion of their income slashed. Others may have income reduction/loss threatened and they don't want to chance it by having a rent they couldn't handle on reduced hours or unemployment.

Also to note that it is possible to find something by your target tenants in the $1000-$1200 range in a decent area of Durham so they may be looking at that.

I doubt that pricing it higher would bring the desired effect.

[sll3454]

We aren't against lowering the price, but we were afraid of attracting more people with low incomes and bad credit to apply. (In fact, we did lower the price temporarily, and we do have a lower price for a 2-year lease.)

Someone is renting the $1400 - $1800 houses.

So 4 bedrooms in a good Durham neighborhood should be $1000 - $1200?

[DPK]

Originally Posted by mia78

I think the problem is that in this economy, your target tenants are trying to find something cheaper.

Based on personal experience as I'm currently one of these people looking for a unit to rent, that's 100% true. I know what I can afford, but I don't want to pay that as I'm trying to be conservative in this economy.

Sucks for the landlords, but I know that something will eventually come along as landlords get more frustrated. If you watch craigslist as vigilant as I have been lately, you'll see the same unit week after week continually drop in price because nobody wants to fork over that much money right now.

[Green Irish Eyes]

Have you checked out the "competition" to see what other, comparable, houses are renting for? You might be, unfortunately, simply overpriced for the current market .....

[sll3454]

Originally Posted by Dark of the Moon

Have you checked out the "competition" to see what other, comparable, houses are renting for? You might be, unfortunately, simply overpriced for the current market .....

Just did; just lowered it to $1170-$1200 (depends on length of lease). We'll see what happens now.

It was tenant occupied ($1350) when we bought it last fall. I guess a lot has changed in the past year.

We won't mind too much if we get a really good tenant.

[paudubon]

Our 3BR, 2.5 ba + bonus room in SW Durham is renting for $1350/month and we didn't have much difficulty finding a good tenant (~3 weeks). We were aiming to charge $1395/mo but given the market, I think we priced it correctly at $1350.