Zillow now offers “Zestimates” for rental properties in Austin. Want to see how much a home might rent for? Just look it up on Zillow the same way you would the value of a home in Austin. Let’s see how accurate it is.
I took a look at some actual homes I manage, from all areas of Austin, and compared the actual rented value to the Rent Zestimates for Austin.
|SW Austin 78736||$1,260.00||$1,295.00||-2.70%|
|South Austin 78745||$1,276.00||$1,195.00||6.78%|
|South Austin 78748||$1,394.00||$1,395.00||-0.07%|
|SE Austin 78741||$1,195.00||$995.00||20.10%|
|Central Austin 78704||$1,539.00||$1,795.00||-14.26%|
|Central Austin 78705||$1,332.00||$1,650.00||-19.27%|
|Central Austin 78756||$1,319.00||$1,595.00||-17.30%|
|NW Austin 78759||$2,429.00||$2,495.00||-2.65%|
|NW Austin 78729||$1,417.00||$1,395.00||1.58%|
|Cedar Park 78613||$1,252.00||$1,300.00||-3.69%|
Looks like Zillow Rental “Zestimates” either get it pretty close or way off. Of the 10 homes reviewed, 4 are incorrect by 14% or more with three of the four underestimating the rent, and one over estimating by 20%.
Five out of the remaining six were within a margin of error less than 5%. Not bad, actually. These were mostly underestimated as well.
So how do you know “for sure” the rental market value for a house in Austin? There are some simple rules of thumb.
First, unless we’re dealing with values that are way above or below the averages and medians in Austin, most homes in Austin will rent for around 0.75% of sales market value. So if you own a typical Austin home valued at $200,000, it will probably rent for about $1,500 per month. Of course, as in the sales market, other factors, such as condition, location and quality of schools will raise or lower the amount.
Another rule of thumb, though much rougher and less reliable, is price per square foot. The typical home in Austin rents for about $0.75 per square foot. So, the typical 2,000 sqft Austin home will rent, again, for about $1,500 per month. Location affects this a lot though, just as in sales. Homes in Central Austin will rent for $1.00 to $1.50 per square foot, sometimes more if they’re smaller.
Another factor in rent value is the level of selectivity of the landlord. If you advertise your Austin rental home “bad credit and big dogs welcome, no deposit and first month free”, you can command a rent value well above market. Likewise, if a home is “no pets” and requires perfect credit, the pool of candidate renters is smaller, and thus the rent value is affected by the decreased demand.
For most of us, we try to strike a balance between finding the best tenants while understanding that many people have in fact had some credit problems. Half of all renters have pets, so even when we advertise “no pets”, we’re sometimes negotiable.
As a renter, the best way to know you’re paying the right price is to simply shop around and look at some available homes. It’s easy to find homes for rent in Austin. You can use our online Austin MLS Search tool at the Crossland Team website, or try AustinHomeSearch.com, which is the public feed of the Austin MLS. After you look at enough places, you’ll have a good sense of rental property values in Austin.
Finally, if you want more stats, take a look at the Austin rental market updates that we post every now and then.