So I completely redid a 960sf, one bath single home that was built in 72. The going rate for this type of home is usually about 900 and usually draws a C or B- tenant for my area .

I completely redid a home like this with a new kitchen w/ granite. New Tub, Installed new led resessesd lighting. Spent about 20k and did the job myself. Currently renting the place for 1200 with a great "A" tenant. The Tenant remarked that when he saw the house online, he thought it was a scam.

So anyways, I had to show it to about 50 people before I got the tenant I have now.

So I was wondering about the feasibility of auctioning off the rental rate with blind bids. So I list the house for 1200. If a renter does not want to pay that much, I ask him to submit a blind bid that he is willing to pay and tell him in two or three weeks, whatever drop dead date I decide, whoever has bid the highest amount will get the place at that price.

I suppose it could work. Never tried it.

What if he makes a bid, you hold it for 3 weeks, he's the winning bid, then he backs out on you? Are you taking a non-refundable holding fee with the "bid" in case he wins and then backs out?

Every week of vacancy costs you the same as a 2% reduction on the rent. Another way to look at this is you will make the same RENT per year at a rate of $1,125 / month who can move in today and pay vs. someone who pays $1,200 but you hold it open for 3 weeks. Add on costs for utilities, lawn care, etc. that a tenant would normally absorb.

I actually like the idea.

In some areas where real estate sales are hot, the listing companies encourage multiple bids and making offers above list price.

If a hot new car comes out, dealerships often raise prices $10K or more above list price.

Why not put up a rental as a bid, say in an auction style?

I can see the ad:

Beautiful updated home for rent to best acceptable bid, subject to qualification and owners approval.

It would limit things to people who are moving because they want to, not because they needed to. However, I'd be cautious about timelines--- because most desirable people who are interested in moving are already locked into some form of a lease or another, with penalties for breaking it early or with insufficient notice. So to get their timeline to synch with your timeline is just as much a gamble as anything else.

I was thinking of a couple of good scenarios where it may be beneficial.

I do open houses where I will schedule as many people that want to come by between say 6pm and 730p. I have gotten 5 or more couples that say they want an application. So what I am thinking about the people that are on the fence is just give a number that you would be willing to pay and in 2 weeks, I will offer it to whoever bid the highest. This will help me if I priced it a little high for the area.

Also, maybe someone looks first and offers what I am willing to take, but the third person who looks at it really wants it because of the distance from their job or school. As a result, They are still able to get it from the first people that looked at it by bidding just a few dollars more.

I have never been able to get anyone to move in right away unless they were trouble. All of the decent people that I wanted to rent to needed till the first of the next month at a minimum. Some even wanted the first of the month 2 months away.

I think I may try this next time one of my houses are empty.

I have rentals very close to excellent public schools. Unless a parent finds housing allowing their children access to a great school, their option is private schools -- costing between $7000 and $20,000 per child per year.

So some lazy last minute parents are forced to take anything they can find in the way of a rental near to a good school. My problem is that I'm a contractor and re-model and upgrade all of my rentals so they "Out Shine" the competition.

I like the concept, but there are some issues in practicality. Most people that apply for my units need an answer soon, as they are looking at multiple properties. If I tell them they have to wait 2 weeks, they will find another place.

Also as pointed out what if the "top" person turns you down...you'd have to go down the list...I guess that's similar to what we do even without a bidding process.

If you could somehow figure out a way to do this all within a day or two it would probably work well. Maybe if you could let people know ahead of time that you'd be accepting sealed bids at the open house and have multiple people show up, that would work. You'd probably get one person who takes you off to the side and says "Hey, we like the place, if we give you $xxx/mo would you take our offer right now?" You could leverage that by having a statement such as "Rent is $xxx/mo or best offer below this via sealed bid at open house"

Too complicated ... you are not selling a widget, but renting to tenants that you have to screen for. And then there's the problem of pet fees that vary with the tenant

What I usually do is list the property for slightly above market ($50-$100) and when people ask if price is negotiable, I tell them, yes based on application and credit report. Then when I have accepted application, I do negotiation based on how much demand I have.

The only tenants who offer to pay me more are tenants that no sane landlord would accept. The really good applicants want to offer $100 less per month and sign a three year lease.