[matt_the_bass]

Don’t you have a good idea of the maintenance needs for that house? You lived there.

If you don’t understand the costs of living in it as your primary residence, you perhaps should consider that realestate Investing/management might Not be a good match for your skill set.

[pxhb]

I have an idea what it costs me personally, but I am not sure how to price in the plain fact that renters will not care for your house as much as you do.

[davismwfl]

And you are right to ask this question. Your costs when you live in the house will not be the same as when someone else moves in. It is also why I suggest you talk to a local agent or 2 because they will know the trends in your area.

I had a house in one city that the maintenance cost was outrageous compared to my other properties but it was in the middle of the pack (cost wise) for the city demographics and building codes. So it is hard to pinpoint even for an experienced real estate person without doing some analysis in your area specifically.

Here are a few of my common questions to an agent if I am looking at a new area:

1. Average time on market, from day of rental listing to lease signed.

2. Basic demographics and occupations of the people living in the neighborhood and surrounding area. Including average income.

3. Hardest to rent property details compared to the easiest to rent. e.g. 4 bedrooms might be super hard to rent in an area with predominately single people, but would be super easy in a family driven neighborhood. I'm looking for contradictions here, e.g. they say the area is predominately housing single people but the demand is for 4 bed/3bath houses. Either they are idiots, or it is group housing/party area which can bring up a different set of rental criteria. Or there is something super unique about this area and they should be able to articulate it to me or I don't accept that risk.

4. Average cost of maintenance for similar rentals. I usually ask, avg plumber cost, avg electrician if I don't have people in the area so this way I know what they are seeing.

5. Special lease terms that are needed or common for the area. And special county/city or HOA rules or costs I need to be aware of. Including parking fees etc.

6. Largest employers in the area by number of people.

[matt_the_bass]

Great list! Thanks for sharing. I was thinking only about the maintenance costs of the structure.

[davismwfl]

You're welcome.

Real estate is almost entirely about demographics, learning the target audience/area will let you understand the situation and risks better.

Honestly no different than startups IMO. If we build a product that there is no client for it doesn't matter how cool it is or how much money we raised or spent. If you build (or buy) a property that is wrong for the area, selling, renting or doing anything with it will become nearly impossible.

[matt_the_bass]

Ahh got it! Thanks! Sorry, I didn’t understand before.