hard to rent after summer

[oceanbreeze]

I bought a bigger house closer to coast and plan to rent my current house in 4S which maintained very well. I listed my house almost 4 weeks ago in Craiglist and Zillow, rental is $200 lower than summer market price. But it turns out hard to rent it out, in average 2-3 inquiries per week, 1 house showing per week. But applicants either have trouble on income or credit. I paid off MR, so it makes disadvantage to sell the house. I would like to rent it out and keep it for long term to maximize the gain of MR payoff investment. My house is clean and close to school, no applicants complained price yet, so I assume I ask for reasonable renting price. It looks the renting market is very slow in 4S area after summer. Any suggestions? Any similar observatoin for other adjacent areas?

[moneymaker]

You could still sell it, just make the paid off MR a selling point, and adjust the price accordingly. In hindsight selling would probably also be hard this time of year. Most people are settled in a place unless changing jobs or family size.

[spdrun]

You’re not asking the market price — if you were, you’d be getting more viables per week. You’re asking what others WISH they might be able to rent for. Suck it up and drop your price, or write a better ad that gets people’s attention.

[livinincali]

[quote=spdrun]You’re not asking the market price — if you were, you’d be getting more viables per week. You’re asking what others WISH they might be able to rent for. Suck it up and drop your price, or write a better ad that gets people’s attention.[/quote]

That’s sort of the problem with higher priced rentals. Your tenant pool just isn’t that deep. There just aren’t a lot of families that want to spend $3K plus in rent on a family home in the suburbs. They’ll buy something instead.

[oceanbreeze]

So it’s not wise to keep big house as rental? I’m contacting listing agent too to sell the house if the renting is so hard. I don’t think that’s the price issue though because none wants to negotiate price to me. But lowering the price to next bracket certainly will help attract more tenants. It’s mainly the tenant pool issue which running thin sharply after summer.

[flu]

[quote=maoing]So it’s not wise to keep big house as rental? I’m contacting listing agent too to sell the house if the renting is so hard. I don’t think that’s the price issue though because none wants to negotiate price to me. But lowering the price to next bracket certainly will help attract more tenants. It’s mainly the tenant pool issue which running thin sharply after summer.[/quote]

I think most people who move with families do so before school starts. Also, I don’t how good the job market is in RB/4s.

I use to work in RB, and if I remember the tech corridor there had a lot of downsizing. Broadcom is down from occupying 4 buildings to 1, Sony trimmed a lot of employees there, so did Nokia, Microsoft, Yahoo. And there were a lot of cuts to BAE and other defense company is there. But I haven’t been back there for awhile, do wouldn’t be able to tell you what’s going on right now in the tech area there.

If you don’t mind me asking, how much for rent and what is the square footage?

Right now 2600sqft in Carmel Valley won’t have a problem fetching $4000/month for rent.

I don’t think it’s a problem with the high price of rental, because some people.can afford the payments. They just can’t come up with the down payment for a loan.

[oceanbreeze]

My house sqf. is little bit over 3000, my neighbor rented 2900 sqf house with $4000 rental without problem in summer. If people chose buying the house, besides the big chunk of down payment, the monthly cost would be around $4200 (mortgage, tax, hoa etc.). For high price rental house, the credit and income check is more strict, so I rejected some applicants due to that sake.

[quote=bullishgurl][quote=maoing]So it’s not wise to keep big house as rental? I’m contacting listing agent too to sell the house if the renting is so hard. I don’t think that’s the price issue though because none wants to negotiate price to me. But lowering the price to next bracket certainly will help attract more tenants. It’s mainly the tenant pool issue which running thin sharply after summer.[/quote]

I think most people who move with families do so before school starts. Also, I don’t how good the job market is in RB/4s.

I use to work in RB, and if I remember the tech corridor there had a lot of downsizing. Broadcom is down from occupying 4 buildings to 1, Sony trimmed a lot of employees there, so did Nokia, Microsoft, Yahoo. And there were a lot of cuts to BAE and other defense company is there. But I haven’t been back there for awhile, do wouldn’t be able to tell you what’s going on right now in the tech area there.

If you don’t mind me asking, how much for rent and what is the square footage?

Right now 2600sqft in Carmel Valley won’t have a problem fetching $4000/month for rent.

I don’t think it’s a problem with the high price of rental, because some people.can afford the payments. They just can’t come up with the down payment for a loan.[/quote]

[flu]

Well, if it makes you feel better, it took 4months for me to rent out an 1800 sqft home in the bay area for $3900 in july.

I was being extremely picky. In hindsight, if I lowered it by $200 for the first six month, it probably wouldn’t have taken 4months, maybe two instead. So in the long run, it would have been better to do that than to kept things vacant for 4 months.

If you lower it too much below market, you end up getting a lot of shady characters.

I had one that tried to air bnb my house. Lol

[flyer]

We have many rentals–SFH’s and other–in CV and elsewhere, and rarely have vacancies. That said, I think your only real problem right now is the timing.

From my experience, and that of friends, this time of the year, with the school year upon us, and going into the holidays, can be a somewhat difficult time to find buyers or renters–especially for SFH’s in certain areas.

Hopefully, that will, once again, change again in the Spring. Don’t want to give advice, but, if it were me, I’d probably wait until then to make a decision.

[oceanbreeze]

Thanks for advice. I also suspect it’s the timing. I’m currently cutting the price in hope to attract more potential tenants.

[quote=flyer]We have many rentals–SFH’s and other–in CV and elsewhere, and rarely have vacancies. That said, I think your only real problem right now is the timing.

From my experience, and that of friends, this time of the year, with the school year upon us, and going into the holidays, can be a somewhat difficult time to find buyers or renters–especially for SFH’s in certain areas.

Hopefully, that will, once again, change again in the Spring. Don’t want to give advice, but, if it were me, I’d probably wait until then to make a decision.[/quote]

[Escoguy]

Maoing

where are you listing the home? i.e. which website.

Is this your house?
http://www.zillow.com/homes/for_rent/San-Diego-CA-92127/house,mobile_type/54908397_zpid/96668_rid/4-_beds/0-1138803_price/0-4000_mp/2900-_size/33.114118,-117.016582,32.930462,-117.236309_rect/11_zm/

This is the only house of 3,000 sf below 4K. Seems nice enough.

If it’s at the right price, you will get a lot of interest. My rentals are in the $2900 to $3400 range. Most recently rented on in four hours with a good increase.

Two came on the market in the summer and I had over a dozen families come by within days.

Given, the is a difference between paying $3250 or $4000.
I would on balance prefer to have it $100/$200 below market and rented than to wait several months. Been doing this almost 20 years and I’ve never had a vacant month. Landlords don’t lead the market, we follow it.

Many tenants will have some credit issues, you need to decide how picky you want to be but there is a difference between the occasional disputed bill or an eviction.

Bigger picture, you need to ask yourself, do you want to be a landlord.
If the house has high property taxes and was not purchased at a discount via foreclosure or short sale, it may not be ideal as a rental.

A landlord needs an edge in the San Diego market. Passive income is best earned with properties bought at a discount.

[oceanbreeze]

Escoguy,

I noticed that $2900-$3200 range house rented out pretty fast in the meanwhile I listed my house in 4S ranch. The link is not mine, instead I sent you a private message including the link of my house.

[flyer]

“A landlord needs an edge in the San Diego market. Passive income is best earned with properties bought at a discount.” Agree, and definitely something for the OP to consider.

My wife and I got into the business with our parents when we were kids, and before going off to college. We purchased our investment properties in LJ, DM, CV and elsewhere in the 80’s and 90’s with loans/partnerships from/with the folks.

Things have changed a lot in San Diego, and everywhere since then, and, imo, a real estate investor entering the market today, would be wise to weigh the pros and cons, to make sure this type of investment makes sense for them in the present financial environment.

[earlyretirement]

I wouldn’t look at a paid off Mello Roos as a negative when selling. I’d actually look at it as a huge positive in an up market like this. I actually met a few people that also paid off their MR and they were able to use it as a big selling point when selling as the buyers could roll up the extra cost into a mortgage vs. shelling out cash out of their pockets each year.

If it’s taking you forever to rent then it’s either priced too high or it’s not as appealing as others. Ideally you’ll want to paint rooms neutral colors, have clean carpet, etc.

Always better to lower prices and keep it rented. I own a ton of rental properties and a philosophy I had from long ago is a rental day is much like life. Once it goes by you can never recover it again.

[Author]

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