Fair Rent Calculator
Calculate how much rent a house should cost based on property value, market zone, size, and expenses. See value-based, size-based, and blended fair rent instantly.
How It Works
Determines an appropriate monthly rent for a property based on its market value, local cap rates, and the 1% rule thumb.
Formula
1% Rule Rent = Property Value × 0.01
Cap Rate Rent = (Property Value × Cap Rate) / 12 + Monthly Expenses
The 1% rule is a quick benchmark. The Cap Rate formula is more precise, working backwards from the desired return on investment.
Worked Example
Pricing Rent for a $300,000 Home
- Property Value: $300,000
- 1% Rule Estimate: $300,000 × 0.01 = $3,000/mo
- Cap Rate Estimate (Assuming 6% target and $500/mo expenses):
- Annual NOI Target = $300,000 × 0.06 = $18,000
- Monthly NOI Target = $1,500
- Required Rent = $1,500 + $500 = $2,000/mo
Common Mistakes
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Strictly relying on the 1% rule
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In highly appreciated markets (like coastal cities), the 1% rule is often impossible. Use local comps and Cap Rates instead.
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Forgetting to factor in property taxes
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Rent must cover property taxes, insurance, and maintenance, not just the mortgage.
Frequently Asked Questions
Related Guide & Instructions
2026-07-05
How Much Should I Charge for Rent? (Landlord Pricing Strategies)
Learn how to price your rental property using the 1% rule, valuation cap rates, and tenant affordability guidelines.
Read full guide →Related Calculators
DisclaimerThe results provided by this calculator are estimates and for informational purposes only. They do not constitute financial, legal, or professional advice. Please consult with a qualified professional for your specific needs.