Rent “deal” survey

[Stu949]

Aliso Viejo, CA

I’m renting a 2 bedroom 2 1/2 bath townhouse in Aliso Viejo for $1750 a month.

Comps are somewhere around the $500,000+ range, but I haven’t been keeping track lately.

[speedingpullet]

We’re renting a 2b/2b SFR, 6K lot with garage in Van Nuys for $2100. Currently valued on Zillow in the low 600’s.
Using the 150x rent formula, still roughly double what its ‘worth’. So, we’re not planning on leaving anytime soon.

[bub]

Renting a 2br/2ba pos condo conversion in Crown Point for $1850.

These units sold for $585k at the peak. 3 next door/ below me are bank owned. They are asking $480k for one of them after numerous price reductions.

Has one thing going for it. The view is incredible.

[CardiffBaseball]

Renting in Cardiff, 3 Br, 1.75 BA (Shower only in Master BR).

Decent yard, house not well maintained, 1050 Sq. Feet or so. Just East of I-5 which is LOUD.

$1800

[Bugs]

Interesting. Most of these rents represent monthly rent multipliers of between 285 – 300, with a few above and below that. A Gross Rent Multiplier (GRM) for single family and 2-4 properties is found by dividing the sale price by the monthly rents. For example, a $550,000 home (at peak pricing) renting in the $1,900 range would yield a GRM of ~290 ($550,000 / $1,900 = 289.47).

What’s interesting is that back in the mid 1990s, GRMs were commonly running in the 120-150 ranges, depending on location and other attributes. Right now, a $1,900 monthly rental rate would indicate to a $285,000 purchase price if using a GRM of 150. That’s a long way from a $550,000 peak price.

[sdcellar]

Bugs— Yes, that’s what I’m seeing as well and part of my motivation for asking the question in the first place (to see if there was consistency in GRM). Thanks much for posting the great explanation and samples.

[Anonymous]

By the way, for some historical perspective I served as a landlord for a house in ’99 that rented for $1,900. It was probably worth at the time about $300k. It later sold in late ’01 for about $375k.

Really shows how out of whack the current prices are compared to rents.

[oc_fliptrack]

I’m at 310 GRM here in Irvine.

I keep saying 50% down to the trendline, 50% down to long-term affordability, 50% down to normal GRM’s.

Here’s hoping for 1/2 off.

[mixxalot]

I rent a room in a nice home in Ventura for $550 per month and have use of a kitchen, bathroom and living room. Its far cheaper than the ridiculous rents for $1300 per month in Camarillo/Ventura for a 1 bedroom apartment and far cheaper than a massive 5-8k mortgage payment each month. I get nailed on taxes but once I form the business and get this setup I can get better tax savings without the risk of home ownership. I am waiting a few years at least to see what happens to home prices in Los Angeles, San Fernando Valley, Santa Monica, Ventura, Orange County and San Diego. After all, how many suckers can really spend 5-20k per month on a mortgage? Maybe 1% of the population is my guess.

[treylane]

I live on a 2-on-1 lot that rents for 3100/mo total, that’s on the market right now for 750k-780k.

[North County Native]

I have a great deal!
I rent a 3 bedroom 2 bath apartment for $494 a month! Its in a very nice neighborhood with an excellent elementry school down the street. We had to get on a loooooooong waiting list to get in here but it was well worth the wait! We will not move out of here until we have a huge downpayment for a house (a few years yet). I don’t really like apartment living but I have a great unit, lots of great neighbors and one bad one but overall we can save $$$$. We would’ve left the state (and our families) if we had not gotten in here when we did.

[PerryChase]

I just heard of 18-unit complex in Point Loma a couple blocks from the ocean. They have 1-bedroom going for about $950 now including cable and water. Loma Manor Apartments. I’ve not been there so I don’t know if it’s a nice place.

[avidsaver]

Well, my deal isn’t as good as many of yours, but I rent a 2bed/2bath condo in L.A. County for $1,550/month. 1.5 years ago, one sold in the complex for $500k, and now similar ones are listed in the area around $520K (I don’t know what they’re getting though). So, rent vs. buy is way in my favor.

[kev374]

I rent a 700sqft 1bd in Lake Forest for $1320 (no utilities are included). I’m thinking this is excessive and planning to move out, do you think this rent is reasonable? The unit does have a 1 car garage.

[contentrenter]

I rent a 1300 sq ft loft in a cool old building downtown, for $1400/mo. Similarly sized units in the area are listed at between $500 and $600k — which would cost me well over double, even after the tax break.

[Author]

Posts