The Residential Real Estate Crash Index Message Board

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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: Lizzie Tudor who wrote (6068)	10/17/2002 3:08:29 PM
From: Wyätt Gwyön	Read Replies (3) of 306849

I am renting a SF house for $2100 what would the approximate sale value of that house be? i found in Honolulu there were rentals in that price range which would have a sale value of approx 530K--that is for a condo, on which the landlord must pay $500/month or so maintenance fee. in contrast, the rule of thumb i've heard here in Austin is the sale value should be no more than 1% of the monthly rental price. so $2100/month would equate to $210K house value. that formula used to work pretty well here, but i doubt it will as houses have gotten more expensive (nothing like SF of course, but expensive by texas standards), and now that loans are so cheap, lending standards easy, and down payment requirements low. i don't see how high housing prices can be attractive to prospective landlords, as there's only so much the market will bear on rental prices.

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