"I need to charge $3,000/month to cover my costs."

I hear this from new landlords all the time. And I get it - you have a mortgage, property taxes, insurance. You did the math. You know what you need.

But here's the problem: The market doesn't care about your costs.

The Rookie Mistake

Let's say your carrying costs are $2,800/month. You think, "I'll charge $3,000 and make $200/month profit. Perfect!"

So you list at $3,000.

Meanwhile, comparable properties are renting for $2,400.

What happens?

You sit vacant. For 60 days. Maybe 90.

Let's do the math:

• 60 days vacant =

  $5,000 lost

  (2 months of $2,500 potential rent)

• Plus you're still paying your $2,800 in costs =

  $5,600 out of pocket

• Total loss: $10,600

If you had priced at $2,400 (market rate), even though it's "losing" $400/month:

• You lease in 10 days

• You're only "down" $400/month

• It takes 26 months before you've lost as much as you did in those 2 vacant months

But Wait - What About My Costs?

Here's what most rookie landlords miss: Monthly cash flow isn't the whole picture.

Even if you're "losing" $400/month in cash flow, you're building wealth through:

✅ Property appreciation — Your $400k property might gain $20k in value this year
✅ Mortgage principal paydown — ~$300-400/month goes to equity, not just interest
✅ Tax deductions — You can deduct mortgage interest, property tax, insurance, repairs, and more

That "$400 loss" might actually be a $2,000/month gain in total wealth.

The Right Way to Price

Step 1: Check the market (not your costs)

• What are comparable properties renting for?

• How long are they sitting vacant?

• What's leasing quickly?

Nomad makes this easy for you to do!

Step 2: THEN check your costs

• Are you profitable at market rate? Great!

• Are you "losing" money monthly? Check the total picture (appreciation + equity + tax savings)

Step 3: Make an informed decision

• Price to market = lease faster

• Sitting vacant is the most expensive choice

Try Our Calculator

Want to see if your price covers your costs AND understand your complete investment picture?

Use our Rental Investment Calculator →

Enter your list price and costs to see:

• Your monthly cash flow (profit or loss)

• How much you're building in equity

• Your property appreciation over time

• Tax benefits

Takes 2 minutes. Might save you $10,000.

What's next

• If you can earn enough from your rental with a market price, then price it at market and earn more

• If you can't earn enough, you shouldn't rent the home out

• But don't make the costly mistake of losing $10,000 by pricing based on your costs and not the market

Not sure what to charge? Nomad provides market data and pricing recommendations for every listing. Learn more →