Rental comps are an integral part of real estate investing. But is software like the Rentometer app a good tool to use to find rental comps?
Experienced and wiser real estate investors know how valuable rental comps are when it comes to projecting an investment property’s profitability and setting rental rates in any given market. This is why they utilize these comparable properties to ensure that they are making the right investment decisions, where rental properties are involved.
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Modern technology and the digital age have given real estate investors a precious gift in the form of real estate software and apps. These modern marvels have allowed folks to discover profitable investment properties, acquire real estate data, and make the return of investment projections in a fraction of the time.
Various software programs like the Rentometer app and Mashvisor have become a staple in the modern real estate investor’s arsenal, especially those who are serious about finding the best deals in specific markets.
In this article, we will discuss what Rentometer is and what it has to offer investors as a real estate app. We will also talk about the importance of real estate comps to an investor and how to take advantage of them.
If you’re ready to learn more about rental comps, keep reading.
Related: 20 Best Markets for Real Estate Investing in 2023
What Is the Rentometer App?
Most real estate investors know that each market has its own unique features and characteristics. For this reason, it would be wise for an investor like you to know the actual conditions of the market (or markets) you’re considering investing in. This will help you avoid the many pitfalls that have plagued countless investors who failed to look closely into their markets.
One of the ways investors can check out how a real estate market is performing is by looking at rental comps using different real estate apps such as Rentometer.
Rentometer is one of the more popular real estate websites that allow users to go through neighborhoods to calculate rental rates for rental properties in the area. Rentometer’s website gives you a variety of different rental market statistics, which gives you a better overview of the location. This, in turn, allows you to set the right rental rates for your rental properties.
To use Rentometer, all you need to do is enter the subject property’s address and its characteristics, such as the number of bedrooms and bathrooms. You may narrow down your search even more by putting in the amount you would like to ask for the monthly rent or how much you’re willing to offer for the property.
Rentometer’s search engine then gives you the results based on your filters. The results will help you assess whether the rental rates you have in mind can be competitive in your chosen market when compared to other rental properties.
What Are Rental Comps?
Before we proceed any further, let’s talk about rental comps real quickly. What are rental comps, and how do they benefit real estate investors like you?
Generally, when you’re in the market for an investment property, you typically look at how much the property is worth and what its cap rate or cash on cash return is. More often than not, you would also look at the occupancy rate of the investment property in question.
However, one of the most useful rental market data that a lot of investors tend to overlook is rental comps. Rental comps, short for rental comparables, are properties that possess nearly the same features and qualities as the subject property being considered.
Rental comps are a good way of determining whether a property is worth investing in based on its income-generating potential. They give you an idea of how much you can ask for rental rates in any given market. Armed with this information, you can then set reasonable rental rates that will make your property either stand out or become competitive in any location.
Why Should You Use Rental Comps?
As a real estate investor, there are several reasons why using rental comps is beneficial to any rental property investment opportunity.
Here are a few reasons why you should turn to rental comps before investing in rental properties:
1. Ensures the Investment Property Is Competitive in the Market
The very first benefit of using rental comps is that it allows you to set your rental rates that are just right for the market you’re in. It gives you an idea of how much other similar properties are being rented out.
Having rental rates that are within the range of prices in the area will increase your chances of getting booked and decrease the chances that potential renters will pass you by.
2. Gives You Greater Insight Into the Actual Market Conditions of the Area
Rental comps are a great way to find out how a particular rental market is doing at any given time. Generally, similar rental properties within a neighborhood will tend to have nearly the same numbers as far as rental rates, rental income, cash on cash return, and occupancy rates.
The use of rental comps in an investment property analysis allows you to make a more accurate and realistic comparison and ROI projection because you are using actual market data. The data and information provided by rental comps allow you to see what the actual market is like as far as rental property investments are concerned.
3. Maximizes Your Rental Income As the Market Allows
Pricing way above or below the market rates will only lead to a loss on your part. As we already mentioned earlier, having rental rates that fall within the acceptable market range will boost your occupancy rates.
For instance, if you overestimate the value of your property and set above-market rental rates, potential renters will most likely turn to other similar yet more affordable properties in the area. On the other hand, if you set below-market rental rates, your occupancy rate may go up but your return on investment will take a longer time to recoup.
Using rental comps to set market-appropriate rates will give you a more stable monthly rental income and give you as high a positive cash flow as the market allows.
Is Rentometer a Good App to Find Rental Comps?
Having said all that, is Rentometer a good app to compare rental properties with each other?
As a real estate app, Rentometer has helped investors analyze rental markets and set rental rates that allow them to have a decent rental income and ROI. Rentometer users have also found rental properties and apartments using the app.
However, as good an app as Rentometer is, it also has its limitations. Most investors know that Rentometer is useful for acquiring basic rental market data but it may not always give you the data and information you need. For this reason, you might want to check out other apps quite similar to Rentometer that can give you more bang for your buck.
Related: Looking for Reliable Traditional and Airbnb Rental Comps? Here’s the Best Source
What Is the Best Alternative to the Rentometer App?
Rentometer is just one of many apps in the market that investors use to locate investment properties and analyze rental markets. Some may have more to offer than others but generally, they’re all nearly the same. Their only differences from Rentometer and from each other lie in their unique features and the user experience they offer.
Apps and websites such as Zillow, Rent.com, Motovo, and Trulia are all great examples of Rentometer alternatives. Each of them is a great alternative to Rentometer because of the different features they offer their users.
However, one Rentometer alternative website might just be the one that can give you the information and tools you need to find the best possible deals in any location across the US housing market: Mashvisor.
Related: What Is the Best Rentometer Alternative in 2023?
Mashvisor: Your One-Stop-Shop for Real Estate Investing
As far as real estate apps go, there is one app that can give you more than just rental comps. Compared to Rentometer, Mashvisor gives you more value for your money. Let’s compare both platforms and see how Mashvisor fares against Rentometer.
Real Estate Market Data
Where real estate market data is concerned, both Rentometer and Mashvisor provide investors and users with only data for investment property and neighborhood analysis. The question now is which one of them offers the best quality data.
Rentometer acquires data daily from all over the US. A huge chunk of the data it collects is based on rental listings. As such, Rentometer’s data generally reflects the rental asking prices more than the actual rent collected by landlords and vacation rental owners.
Mashvisor has the upper hand on this one as it acquires its data from highly reliable sources such as Zillow, Realtor.com, and Airbnb, among others. And because Mashvisor regularly updates its database, it is known to have the most accurate real estate market data for rental properties.
This type of data gives you more realistic ROI projections, which, in turn, increase your confidence as an investor.
When it comes to searching for investment properties, Rentometer may have certain limitations. Keep in mind that Rentometer is a site that specializes in rental properties and pricing. The name Rentometer already speaks for itself. So searching for investment properties, in general, may be limited to properties that do well as rentals.
On the other hand, Mashvisor’s property search tool gives you the ability to look for income properties in various locations, regardless of your investment or money-making strategy. You can be a rental property owner or a house flipper. Either way, using Mashvisor as a property search tool will enable you to find the right properties that meet your needs.
The great thing about Mashvisor is that its search engine gives you an insight into the market as a whole and as a rental property market, unlike Rentometer. When you enter a location in the home page’s search bar, you will be taken to a page showing a map and three tabs on the side labeled “Investment”, “Short Term”, and “Long Term”.
Clicking on any of these tabs will show you properties that are actively listed in the market under their respective categories. This gives you a better understanding of how the market is performing as an investment location and as a rental property market.
Start looking for and analyzing the best investment properties in your city and neighborhood of choice.
According to different reviews, both Rentometer and Mashvisor have user-friendly UIs that give subscribers a pleasant overall experience.
Rentometer is known as a simple-to-use online resource that’s very easy to figure out and navigate. It also has a Rentometer widget that you can embed on your website. If you’re a real estate professional, you might get a kick out of this. On top of that, you can download the Rentometer app for iOS devices. The app is free but, as can be expected, quite limited.
Mashvisor, just like Rentometer, has a very friendly user interface that does the trick for investors who aren’t tech-savvy. It is very straightforward and easy to learn. As a real estate app, Mashvisor also offers its users a wider range of tools they can use to find the best investment properties in the country.
You have tools like the real estate heatmap and investment property calculator that lets you find the most profitable rental properties and crunch the numbers with ease.
As far as rental comps are concerned, both Rentometer and Mashvisor can be used to compare properties side by side.
The only difference is the quality of data you can access from each of them. While Rentometer’s data is mostly based on asking rental prices, Mashvisor gives you actual average rental income, cash on cash return, short-term rental occupancy rate, and listing prices of the market you’re looking into.
These metrics allow investors to see how profitable a subject property is, how the rental market is performing, what the range is as far as rental rates are concerned, and what the occupancy rates are. Having an idea about these numbers will let you plan and strategize accordingly so you can optimize your investment property.
As far as pricing goes, Rentometer may be at a slight disadvantage compared to Mashvisor.
Rentometer’s free features only limit you to enter specific addresses to analyze. You cannot enter a neighborhood, zip code, or city, as they can only be accessed using Rentometer PRO.
At the time of writing, Rentometer has three tiers. They are:
- Free. This gives you only seven days of free access to very limited features.
- Basic. The Basic Plan will cost you $49 per year. This tier allows you to view rents and gives you 10 PRO report credits.
- PRO. The Rentometer Pro tier will give you several features that aren’t available on the free version but only a few that are noteworthy. As it is, the monthly billing for Rentometer PRO is $29, while the annual billing gives you some savings at only $99.
Rentometer’s rates might seem very affordable, but you also need to consider what you’re getting in exchange for what you’re paying.
Mashvisor, on the other hand, will give you more bang for your buck with the following tiers:
- Free Trial. Mashvisor offers interested folks a seven-day free-trial period to give them a sneak preview of what the site has to offer.
- Lite. Unlike Rentometer’s basic plan, Mashvisor’s Lite plan allows you to do more than just compare property prices. At $17 per month, it gives you access to accurate data so you can estimate rental rates and project your ROI.
- Standard. The Standard Plan will cost you $49.99 monthly but lets you do a lot more than the Lite plan, which is already superior to Rentometer’s Basic tier. On top of what you’re getting for the Lite plan, you can also export up to 20 searches to Excel per month and compare properties side by side.
- Professional. Mashvisor’s Professional plan will set you back $74.99 per month, but you get all the benefits of the standard plan plus up to 60 searches to export to Excel per month. Additionally, you can also look for multifamily properties and upload and analyze listings.
To get access to our real estate investment tools, sign up for a 7-day free trial of Mashvisor today, followed by 15% off for life.
Wrapping It Up
When it comes to finding rental comps, you can turn to real estate apps such as Rentometer. Investors have found the Rentometer app quite useful in researching rental prices and setting rates that give them a decent rental income.
However, it is also important to note that Rentometer is quite limited as a real estate app. Its data is not as accurate and reliable, plus the app’s features limit what you can do as an investor.
If you’re serious about real estate investing, especially when it comes to rental property investment, we recommend going with the best Rentometer alternative: Mashvisor.
With Mashvisor, you get more value for your money with its wide range of tools and huge database. Utilizing the site’s features will give you better chances of finding the right investment properties with the property search tool and real estate heatmap. The site’s investment property calculator will also make doing the math a lot less complicated.
If you want to know more about how Mashvisor can help you make wiser investment decisions, schedule a demo.