LAKEVILLE, Minn. -- One property manager says he's having a hard time keeping up with former home sellers who are now entering the rental market.
"It's been really busy. The business has just been coming in just as fast as we can possibly process it," said REI Property Management Owner Steve Rajavuori.
Rajavuori was standing in the doorway of a modest Lakeville home that would be occupied by renters from Iowa by the week's end.
"Especially all over the suburbs; Lakeville's typical. Woodbury, Eden Prairie, Maple Grove, there's just a lot of houses like this that people are clamoring for. Usually, there's more renters then there are houses available for the demand," he explained.
REI typically keeps the first month's rent as a finder's fee. Then the homeowner pays $100 a month for REI to act as the landlord; the homeowners sign one year contracts.
Rajavouri says more than half his clients are folks who have moved away from the area but couldn't sell their home. Other clients are afraid they'll lose too much money by selling now.
Rajavouri says clients usually have their homes on the market for an average of about 9 months before they turn to renting.
"We're really beginning to recover from a year ago," Brad Fisher said when asked about the Twin Cities' housing market. Fisher is the President of the Minneapolis Area Association of Realtors. He says the market has been improving each month, but that the climb back is still extremely slow. "Days on the market are still fairly lengthy. I would say they're still in that 140 plus range right now," Fisher said.
Rajavouri says renters are typically looking for homes valued between $150,000 and $250,000; paying an average rent of close to $1,500 per month.
"You'll find places like this sitting empty waiting for sale all the time," he said, looking around that soon-to-be-occupied home.
Everyone in the industry advises homeowners to carefully consider their options before deciding to become a landlord or hire a landlord.
Many realtors have a good gauge on both the house-selling market and the rental market and can help you make the best financial decision.
(Copyright 2011 by KARE. All Rights Reserved.)