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I Need More Money Now...

By
Real Estate Broker/Owner with Daytona Condo Realty, 386-405-4408

A friend called. His tenant is leaving, and he is worrying. Asking to help him find a new tenant, but warns me that he needs to increase rent significantly.

- I have circumstances. We just had a baby, and for now I am the only one who’s working, expenses are up, so I need to rent my townhome for more.

- I am very sorry to hear that, but when you are renting your townhome, your circumstances in New York mean diddly squat in Daytona Beach.

How much you can rent your townhome for depends only on the market where your townhome is:

You rent for what your local market can bear.

- But it is a national trend that rents are up…

- You are not renting nationally, you are renting here and now. Here locally in some places rent goes up, in some it is stable.

You rent for what your local market can bear.

- You do not understand, my maintenance is up, my taxes are up, so my rent should be up as well…

- Not necessarily. There are brand new fancy apartment complexes in the vicinity, and they fiercely compete for the same tenant, offering good rates and discounts.

You rent for what your local market can bear.

Comments (21)

Diana Zaccaro Broker Associate
ZOOM Realty Group - Cocoa Beach, FL
"The Accidental Blogger" Cocoa Beach, Florida

Trying to get people, especially those from out of state, to understand that the market sets the price can be an uphill battle, Jon. Perhaps you should suggest that you friend sell his townhome if he can no longer be competitive on rent.

 

May 16, 2016 01:37 PM
Debbie Gartner
The Flooring Girl - White Plains, NY
The Flooring Girl & Blog Stylist -Dynamo Marketers

Yes, costs and value are 2 different things.  Price to what the market can bear.  That's true, regardless of the product.

May 16, 2016 02:16 PM
Bill Roberts
Brooks and Dunphy Real Estate - Oceanside, CA
"Baby Boomer" Retirement Planner

Hi Jon Zolsky, Daytona Beach, FL Since when does it matter what the owner NEEDS? Only the market prices the rental. I hope he understands that, especially if he wants you to find the new tenant. I don't envy your situation.

Bill Roberts

May 16, 2016 10:34 PM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Robert May - for some reason this very simple notion is often not understood. People look at rent from the point of "what they need" rather than what people are willing to pay.

May 16, 2016 10:53 PM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Diana Zaccaro - actually, I am glad he is not selling it. It would have to be a short sale if he did, but if he holds a bit longer, there will be money.

He can survive, he simply wants more, as his expenses are up, but sometimes it is simple math. You have someone today who would pay less, but there will be no gap, or you can sepnd 2-3 months to wait to get someone to pay a little more, and this more would not justify waiting.

May 16, 2016 10:57 PM
Tammy Lankford,
Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668 - Eatonton, GA
Broker GA Lake Sinclair/Eatonton/Milledgeville

Had a similar conversation today.  They want to buy THIS house so they need sell their house for THAT.  

That's not how any of this works.

May 17, 2016 08:48 AM
Endre Barath, Jr.
Berkshire Hathaway HomeServices California Properties - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Jon, the Los Angeles rental market is insane, hard to believe what the rents are going for... on a side note I had a question on one of these trivia websites and the question was what do one bedrooms in New York City go for... would you believe $3500 is the average....Endre

May 18, 2016 04:40 PM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Tammy Lankford, -seems like an easy concept, but many do not se it this way, and only see pricing through the prizm of their circumstances.

May 19, 2016 01:06 AM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Endre Barath, Jr. - in New York City it is not easy to come up with the average. I am sure the rent in Washington Heights would be very different from this average.

May 19, 2016 01:09 AM
Debbie Laity
Cedaredge Land Company - Cedaredge, CO
Your Real Estate Resource for Delta County, CO

Great post. I hear this so often from buyers and sellers...I have to pay/sell for this much because I have to do this. It honestly doesn't work that way. The market dictates the value. 

May 19, 2016 01:05 PM
Debbie Reynolds, C21 Platinum Properties
Platinum Properties- (931)771-9070 - Clarksville, TN
The Dedicated Clarksville TN Realtor-(931)320-6730

The market dictates what can be charged and personal circumstances don't. It also makes no diffeerence what they paid for  something as to what it is worth now.

May 20, 2016 12:26 AM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Debbie Laity - but I have difficult time explaining it to customers. For them the deals revolve around them, and they are not. Thank you

May 20, 2016 01:03 AM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Debbie Reynolds - it is an easy concept, but so many Sellers and Buyers, and Landlord missing it... :)

May 20, 2016 01:05 AM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Debbie Gartner - sorry for late repsonse to your comment. thought I responded, and then noticed that I didn't.

You summed it up best. "... costs and value are 2 different things"

Thank you

May 20, 2016 01:09 AM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Bill Roberts - he is the son of our old friend, and we do not charge him a penny. The funny thing is that he is very lucky, and townhome never sits empty long, but every time the tenant is leaving after, usually, couple of years, we go through the same thing, he starts telling me about his circumstances...

And every time we are trying to explain that it is irrelevant, and he says he understands, and then we go this round again...

Funny

May 20, 2016 01:12 AM
Sheila Anderson
Referral Group Incorporated - East Brunswick, NJ
The Real Estate Whisperer Who Listens 732-715-1133

Good morning Jon. You certainly don't minch your words. Accurate though.

May 20, 2016 09:49 PM
Bill Roberts
Brooks and Dunphy Real Estate - Oceanside, CA
"Baby Boomer" Retirement Planner

Well Jon Zolsky, Daytona Beach, FL It sounds more like a lament than a complaint.

Bill Roberts

May 20, 2016 11:36 PM
Andrea Swiedler
Berkshire Hathaway HomeServices New England Properties - New Milford, CT
Realtor, Southern Litchfield County CT

Hi Jon! Well, I have certainly had that conversation in one form or another. I just shake my head. And of course, say NO... 

May 23, 2016 11:27 AM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Sheila Anderson - mincing words is, probably, not my forte :(

May 23, 2016 11:40 AM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Andrea Swiedler - I believe we all deal with this time from time. To see the world through the prizm of one's circumstances moght be more common than we think.

Glad to see you here.

May 23, 2016 11:42 AM