I am about to put my property up for rent and have a question about using a real estate agent vs. doing it myself.

When a tenant uses a real estate agent to find a rental house, what does the real estate agent use to search for houses? Do they just use MLS?

If I advertise my property on all the DIY sites (Zillow, Trulia, etc.), will a real estate agent representing a tenant find it?

Do the homes on those DIY sites get propagated into whatever tool the real estate agents use?

Thanks,

Sal

From our limited experience (and from what I've learned here) I would do it myself. An agent does not care about your small money job and will bring anything that fogs a mirror.

So the tenants come to the agent with the list of houses?

It's not the other way around where the agent is recommending houses based on the agent's search?

Also, if a tenant has a real estate agent... isn't their real estate agent going to expect something from me for bringing the tenant? How does the tenant's agent get paid?

Also, if a tenant has a real estate agent... isn't their real estate agent going to expect something from me for bringing the tenant? How does the tenant's agent get paid?

Another thing I wanted to point out is that this is a house in a "nice" neighborhood that goes for about $1900 a month. It seems like all the houses around here for lease have real estate agent signs in front of them.

You know more about your property than any run-of-the-mill agent. With Craigslist, Zillow, Hotpads; people looking for apartments and rental houses can easily find your listing. Have a ready list of written criteria (income, past rental history, credit history....) and an application to provide to prospective tenants. Looking and acting like a seasoned and experienced landlord is key to being successful. Even if you are a novice and have only one property, being prepared and confident will keep most deadbeats from wanting to rent from you. Never take down payment or rental money on the spot. All prospects must complete the application, pay an application fee ($20 - 35)and be willing to wait at least a day so you can comb through their completed app, check past landlord references and pull a credit check.

If your home is in a nice neighborhood and a desirable location, I'd recommend a no smoking and no pet policy. Less wear and tear on your property.

I'm a small time landlord. Twice, I tried using an agent. Once years ago when I was just starting out, and once about 2 years ago when I hired a "listing only" agent to find me a tenant (advertise, show the property and collect rental applications). Here's a summary of my experience:

1. Standard "fee" in my area (St. Louis) is one month's rent. That was true in both cases.

2. The fee - including $1900 or even $2900 - isn't much money to the agent, and this will be reflected in the amount of attention/work you'll receive.

3. The most important part of the rental process from the landlord's perspective is SCREENING. The agent will not screen according to your criteria (unless you have none, or it's so low you're just foolish). The agent will screen based on 1) what they think you'll accept/agree to, regardless of your criteria, and 2) whether prospect is likely to meet "reasonable" criteria, regardless of whether it matches your criteria.

4. The agent will give you lots of support and a strong sales pitch to get hired, and will be pro-actively communicative for about two weeks. Then you won't hear from them. You'll wonder what's going on. They'll respond when you contact them, but won't bother giving you "updates" on status (how many prospects, how many showings, etc....).

5. When you ask how many showings you're getting, you'll be impressed by the number. Then you'll find out from your current tenant that some of the prospects smoked, or seemed to have other qualities your tenant knows you won't accept. So the numbers you got from the agent are all BS.

6. When you get a rental application and your agent tells you he's contacted prior landlords for a reference, you decide to call the landlord yourself "just to check". You learn things about the prospect that immediately disqualify you from approving her, because the prior landlord is more willing to open up to, and be honest with, the OWNER rather than the AGENT. You thank your stars you dogged a huge bullet and a future lawsuit by calling the landlord yourself.

You get the idea. Never, ever, think an agent is going to care about your future tenant even half as much as you do. They don't. They care about finding a reasonably qualified applicant ASAP, getting paid, and moving on to a higher paying commission.

If you have a nice property, all of the above applies even more so. A nice property means it should rent quickly and easily, and the agent's eyes will glaze over thinking this is going to be quick and easy money. Agent doesn't care about -- and never thinks about -- what relationship you will have with the tenant once the ink is dry on the lease and the money is paid.

Last word: Future tenants appreciate meeting YOU, the owner. They care about their relationship with you. They don't care about your agent. The fact that you take the time and effort to show them the property speaks volumes, and GOOD tenants really appreciate meeting you and having a chance to get a sense of you, just like you get a sense of them.

PS. If you get a call from a real estate agent telling you they have a client interested in your property, tell them you'd be delighted to show it to them (if the client meets your criteria) but that you do NOT pay real estate commissions.

If the agent says "you will have to pay the real estate commission if my client signs a lease for your property" you say "Golly, I'm not aware you and I have a legally binding contract, and to my knowledge, we do not. Therefore, I don't have to pay you anything. And I choose not to pay you anything."

I like listing by MLS. First of all, I'm an agent so I don't pay leasor's fees, just leasee fees for tenant's agent. Usually it's about 1 month rent. Sure it's costly, but it's worth it. You get a client that has already been somewhat pre-screened by the agent. After all, the agent isn't going to waste their time showing houses to someone who can't afford it. I only advertise on MLS. I usually get professionals both white and blue collar as a result. Most stay past the 12 month contract.

Just make sure the agent submits the application and fee to you. YOU do the evaluations and checks. I don't trust anyone but me to do it.

Sal, it would be helpful to have a little more insight into your situation. Is this the first time renting a property? Do you have screening criteria for applicants? Do you already have a lease form that you use? Do you have the time and inclination to show the property yourself. Depending on the answers we may be able to give other suggestions.

We moved into a larger house 1 year ago and put our old one up for rent. We used a broker (Renters Warehouse) who took 1 months rent as a fee. It rented within 2 weeks.

The rent was $1845 and the tenants are trying to negotiate us down. They are demanding we go to $1700 a month which is well below the comps for similarly sized homes. We have a 1987 sq ft single story home and they are comparing it to the price per square foot of a 2800 sq ft two story home. When you look at the neighborhood, smaller single story homes average $0.98 per square foot and big two story homes average $0.88 per square foot. They are demanding $0.85 per square foot. We offered to go down a little but it doesn't look like it will work out.

So now we are figuring out how to put the house back up for rent... go through an agent or do it ourselves.

Sorry I didn't give all the info you asked about...

I don't really have a screening criteria. I suppose if they have good jobs and pass the credit check that would be enough.

I can reuse the lease forms from the first time we rented. I'll edit them to be current and probably make some of the maintenance sections clearer.

I don't mind showing the property myself. But I suppose if a tenant's agent calls and wants to do the showing then I'd let them do it (at the risk of having to pay them if we lease).

I think all the rental houses on my block are owned by "professional" landlords that outsource everything to property managers and real estate agents. All of their signs are for agents.

Tenants often try to negotiate lower rent at the end of the lease. Good job standing your ground, a common saying on this board is the Landlord is in charge, not the tenant.

If I were you I would list it on zillow for at least a couple of weeks to see if you can save the realtor fees.

You will need to have an application to hand them when you show them the place and it is generally a good idea to ask a few questions when you initially talk to them before setting up the showing. The most common are related to when they are looking to move in, what animals they have, and where they work. It saves time by eliminating a showing to someone who isn't looking to move for 3 months.

As for criteria. The basics I use include 3X monthly rent in verifiable and stable income, exclusion of aggressive dog breeds, a good credit rating, no felonies, no collections from past landlords, respectful attitude, and good reference from past landlord.