[PinotGuy]

Originally Posted by Traveler500

When I said rent was expensive, I meant that compared to what the value of the house or apartment is, it is very expensive.

Renting even for 700 a month, on a 40K house is expensive. And that would probably be the best deal you could find at 700. Most I see are like 1K a month and house is like 40K.

I could be wrong because I did not have time to work the numbers out, but compared to what real estate costs in Staten Island, NY. You would pay just a bit more than vegas, like maybe 30% more, but the house value is worth 5x to 10x more.

So for example, you rent in vegas 700 a month, but house costs 40,000. In Staten Island, you would rent 1000 a month, but house is worth 300,000.

You can't just look at the rents in Vegas and compare them to California where the house values are 10x more and say wow vegas is cheap, I pay 50% less, but the house prices in vegas are like 10 times less.

From what I can see, you can rake in alot of cash by buying cheap houses and renting them out, especially if you furnish them. However, I have to work the numbers better and actually see what is on the market. I just got here so did not have time to research, as I need to find a place to live.

I am looking for renting a room currently. Even those are ridiculously priced. Most ask 450 to 600 for a room in a house worth say 100,000. They rent out 2 of those rooms in their 4 bedroom house and they just paid the full rent and can pocket additional money.

The real estate maket in vegas is more like Albany, NY, where you can buy houses fairly cheap and rent them out to college students. I think its a great market here for doing that. staten Island was a terrible market for doing that because the houses were just way too expensive for what you can get in rent.

I am not sure I follow your logic. What does it matter how much a house is worth when you rent? Prices, whether buying or renting, are driven by market. If the economy in LV comes back to the levels of years past I am sure that rents will escalate as well. Right now I am looking at houses in LV that would easily rent for more than double in CA, for similar house/area, but houses in CA are worth more than 3+ times the price of houses in LV. Per your logic then LV houses are more "expensive" than CA?

[AA702]

Yes I think the logic of this convo is a little flawed

[Caltovegas]

The most expensive rent I know of is getting married and then divorced.

[Exaday]

Originally Posted by AA702

Yes I think the logic of this convo is a little flawed

I don't see how it is flawed.

He is saying the Rent should be proportional to the cost of the house. The logic is not faulty, the premise is.

Since few people are buying in relation to renting, it stands to reason rent would go up while property value would go down.

Welcome to the west coast. The housing market in Vegas was largely artificially inflated by Californians who thought the home prices here were such a steal they'd routinely pay 10% over market value for it.

People just getting out from underneath their mortgage probably see the rent they are being charged as a good deal. It's probably cheaper than what they were paying on the house but more than they would pay if they were able to purchase a new home at this moment.

But they can't buy a new home because they are in debt up their eyeballs, their credit score is shot and they lost the stomach for it.

The OP is saying that if home value dropped drastically, so should have rent. The premise is wrong, not the logic. I see exactly what he means, he's just wrong.

Where is Capt to confirm or debunk this?

[AA702]

Originally Posted by Exaday

I don't see how it is flawed.

He is saying the Rent should be proportional to the cost of the house. The logic is not faulty, the premise is.

Since few people are buying in relation to renting, it stands to reason rent would go up while property value would go down.

Welcome to the west coast. The housing market in Vegas was largely artificially inflated by Californians who thought the home prices here were such a steal they'd routinely pay 10% over market value for it.

People just getting out from underneath their mortgage probably see the rent they are being charged as a good deal. It's probably cheaper than what they were paying on the house but more than they would pay if they were able to purchase a new home at this moment.

But they can't buy a new home because they are in debt up their eyeballs, their credit score is shot and they lost the stomach for it.

The OP is saying that if home value dropped drastically, so should have rent. The premise is wrong, not the logic. I see exactly what he means, he's just wrong.

Where is Capt to confirm or debunk this?

Ok I see the point, but its one of those things I really don't see the point since the rental market has nothing to do with the prices of the homes as we can see, its how much people are willing to pay for a rental. But how do I know??? I'm no expert.

[Traveler500]

Simple logic really. You mortgage a house and pay say 450 a month for the mortgage, and say an extra 100 for taxes. You buy a 3 bedroom house. You then rent out the 3 rooms for 400 dollars each.
1200 rental income less 550 expenses.
You are now making 750 a week for renting out 3 bedrooms in a house. That is lots of easy cash to make.
You have 5-10 of these units and your making 50,000 to 80,000 in cash a year. And remember lots of it will be in cash also!
And with the rental market so good and easy to find tenants, which I can see that by looking for a place, it is a safe investment to make.

Don't know why more people are not doing this, and forcing the current rent prices lower. I am sure many landlords now are making out like bandits. If you are handy and can do simple maintenance then you are 1 step ahead of the game.

But again, I did not do enough research to see what houses cost and in what areas they can get for rents. But I sometimes use zillow to get an idea of what the property costs and can't believe how low in value they are.

[Exaday]

Originally Posted by AA702

Ok I see the point, but its one of those things I really don't see the point since the rental market has nothing to do with the prices of the homes as we can see, its how much people are willing to pay for a rental. But how do I know??? I'm no expert.

No you're right. Just saying I see his logic :P

[Exaday]

Originally Posted by Traveler500

Simple logic really. You mortgage a house and pay say 450 a month for the mortgage, and say an extra 100 for taxes. You buy a 3 bedroom house. You then rent out the 3 rooms for 400 dollars each.
1200 rental income less 550 expenses.
You are now making 750 a week for renting out 3 bedrooms in a house. That is lots of easy cash to make.
You have 5-10 of these units and your making 50,000 to 80,000 in cash a year. And remember lots of it will be in cash also!
And with the rental market so good and easy to find tenants, which I can see that by looking for a place, it is a safe investment to make.

Don't know why more people are not doing this, and forcing the current rent prices lower. I am sure many landlords now are making out like bandits. If you are handy and can do simple maintenance then you are 1 step ahead of the game.

But again, I did not do enough research to see what houses cost and in what areas they can get for rents. But I sometimes use zillow to get an idea of what the property costs and can't believe how low in value they are.

Because this is the number one foreclosure city in the USA. The only people who would be able to do what you are talking about are investors. IF everyone has bad credit, just lost their house and banks won't loan money who is going to buy these cheap houses and rent them out? They are forced to rent which is creates demand.

Yeah if people could afford to buy houses and deal with the headaches of renting them out their probably is money to be made. Problem is few people have the capital to do that during these times. Because they're all renting. lol.

I could not do it I bought a home using a VA loan and as such have to live in the home. Not that I'd want to be a landlord.

[PinotGuy]

Originally Posted by AA702

Ok I see the point, but its one of those things I really don't see the point since the rental market has nothing to do with the prices of the homes as we can see, its how much people are willing to pay for a rental. But how do I know??? I'm no expert.

Bingo! We got the winner here!!!

[airics]

its all relative, so the op would also have an issue with the retail market, the entertainment market,etc..

walmart pays $2 for a snuggie, sells them for $15 ...

same concept...

its all about supply and demand...

so many people losing homes, need a place to live...so to find a rental, from a reputable landlord, in a decent area, that is not in danger of foreclosure, is not as easy as it sounds