If you’re a Michigan adult looking for extra money or to pay off a mortgage, renting out an owned property is a great way to achieve these goals. But it’s understandable to have questions about becoming a landlord. A common concern landlords face is how much money to charge tenants for rent.
Following Michigan’s laws
The first factor to look at when setting rent prices is your state’s laws about these expenses. For instance, some states have rent control laws that prevent landlords from charging excessively high rent. However, Michigan is not a state with rent control laws. Under Michigan law, there’s no limit on what price a landlord sets. Additionally, Michigan landlords have no requirement to provide notice before increasing monthly rent.
Looking at similar rental properties
While Michigan allows you to rent a property at any price you prefer, that doesn’t mean it will attract tenants. As a landlord, you should also look at rent expenses for similar properties near yours. Setting a competitive rental price increases your chance of finding suitable tenants. You’ll also avoid leaving money on the table by setting rent too low.
Using a simple calculation
You can also determine how to price rent by knowing the market value of your rental property. Many landlords base rent on 0.8 to 1.1% of a home’s market value. If you had a home worth $230,000, you could reasonably rent this home for around $1,840 to $2,530 per month.
After determining the ideal price for tenants to rent your property, you’ll need to list it. A real estate agent can provide help. If you’re handy with property-selling websites and social media, you can list a rental property independently.