I own a nice home in a nice area. Similar house on the corner just closed for $710,000. 3 bedroom home, 2.5 bath, nice but really kinda basic. It's a great neighborhood and the best school in the county is just down the block, so it's primarily a family neighborhood and I prefer to keep turnover dates on the school schedule. We are in the down-valley shadow of Vail and Beaver Creek ski resorts so there is international wealth pressures, lack of affordable housing and general scarcity. I believe high demand will continue in the future and vacancy will be limited to less than a month (in 5 years of ownership and 4 tenants, turnover vacancy has ranged from overnight, to 1 week). This makes a great formula for being a landlord.

The current tenants are out tomorrow. I placed a yard sign last week and ZERO other marketing. I've shown the house to 3 potential tenants and they have all been A+ (no background checks yet but my gut feelings were A++). It has become a difficult decision to choose who would be best in the home.

Asking rent is $2550 + utilities, first last security deposit is $7650 (which both strike me as a ton of money and beyond what I'd comfortably choose to afford, but this area is kinda going nuts).

Last night, the most recent prospective tenant (single mom and high school daughter) said she would sign a 2-year lease and have the cash to me before Monday.

The other competing tenant (family of 4) is actually former tenants. They were in the home 1.5 years, great tenants, no issues. Bought a house for ~$850k last year, moved out, are now selling that house for a profit because this area is kinda nuts, but now they need a place again. They would require no background check and are financially solid. They can only commit to a 10-month lease (which takes us to 5/31, on the school schedule and likely a time of high demand) and will almost certainly leave at that time, as they're looking at jobs outside the area. I told them the other people offered a 2-year lease and they countered w $2900.

All other things equal, what is better?

10-month lease at $2900 to a known quantity, but having to clean, repair, and market the property again next summer? $29,000 and maybe a higher established rent going forward?

Or $2550 for 2-years? I haven't ran a background check yet but my gut feeling was definitely A+. $61,200 guaranteed over 2 years?

I haven't even mentioned the other family, but they were incredible and I would rent to them in a heartbeat but I feel like I've already got a tough decision on who to choose. Good problem to have!

0 Votes

26 Replies

Jump to Last Reply

Tenant bidding war? need advice

Most Popular Reply