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brucebtaylor, Other/Just Looking in Seattle, WA

Hello. Trying to determine what rent we could ask for on condo next door that we wish to purchase as investment.

Asked by brucebtaylor, Seattle, WA Sun May 26, 2013

Condo is 1090 sq. ft, 2 bed, 1&3/4 bath, fireplace, recently remodeled, comes with carport; in gated community, bus stop across street, minutes away from(new) light rail, easy walk to Capitol Hill, downtown, 15 min. bus ride to U. of W. 20 min. walk to Amtrak station and to light rail to airport. We're thinking $2000/month at least, given one of us has to take out small loan to cover 1/2 downpayment. Could we ask more or does this seem about right? Opinion?
Thank you.
Bruce Taylor
http://www.brucebtaylor.com

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Answers

5
Dan is spot on. Ultimately the consumer will dictate what the property will rent for, but there are some avenues agents use to best determine ahead of time a range for expected income.

Of course, it's all about location. Knowing the subject property is paramount before getting to in too deep for us, but whomever your preferred agent is they can provide you the tools to best determine if it makes financial sense.

I hope that helps
1 vote Thank Flag Link Sun May 26, 2013
Does the HOA allow more rentals than are currently investment properties?
0 votes Thank Flag Link Mon May 27, 2013
The market (renters) determine the market rent. Right now, the landlord is in the drivers seat. But that could change. While you're estimating rents, you shouldn't overlook the vacancy rate, and the lag time between renters. Consider that if the condo turns over once per year, you could lose two months rent. Also, is there a rent cap at this condo? That is, is there a limit to the number of units that may be rented at one time? A rent cap could leave you with a vacant condo that you may not rent, according to the rules of the HOA. Just some additional issue you should consider. Good luck with your decision.
0 votes Thank Flag Link Sun May 26, 2013
A couple of good resources I use are http://www.rentometer.com and of course, Craigslist. The good thing about a condo is that it is often simpler to determine prospective rents as there are often comparable rentals in the complex.

Another resource would be the president of the HOA. They often have knowledge of the other rentals in the complex.
0 votes Thank Flag Link Sun May 26, 2013
Bruce,
When I have a client asking a similar question, I run a search for other rentals in the area to see what they were listed for. Final rent is not published, so we don't know in the end whether the posted rent is the actual, but we have a basis to work off of.
The other question is what will the market bare? You can ask for however much you want, but renters are like any other consumers. They will compare your offering to others at the same rate and go after the best value.
If you are using an agent/broker to help you purchase this, ask them what they can provide for rentals in the area. Compare both active and rented before you decide. If some active ones have been on the market for a long time, they may be overpriced or have some location issues.
Best of luck.
0 votes Thank Flag Link Sun May 26, 2013
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