A "sweetheart" rental rate?

[Tommy Johnson]

How do you tell if it is, or it isn't? Herer's the deal: US Senator Norm Coleman, R-MN, is renting the basement of 140 N. Carolina Ave SE,
Washington, DC for $600 a month.

http://www.phyllisjaneyoung.com/bin...ow=&listing_id=REAEME34109057&start=0&grp=ALL


Senator Coleman claims he "pays the market rate".

I am not an appraiser. My question to those reading this, is just what steps and what report is required to determine "fair market rent"?

Thanks.

 

[Thomas Fiehler]

One would need to find similar rentals and see what they are renting for. Compare basement units and possibly arrive at a dollar amount per square foot per month. The more rentals you can find the better. I would like to use a minimum of 6 to see what the range is. Also be sure that the expense data is similar. If his rents include utilities then you would want to use rentals that also include utilities.

 

[Restrain]

All due respect, but given all that goes on in DC today, you're worrying about what someone is paying to rent a basement?

 

[Tommy Johnson]

With All Due Respect.

...Senator Coleman IS the problem, and he has an Ethics Complaint filed against him over this matter. And the guy he's renting from? Senator Coleman does business with him, Senator Coleman hired the guy's wife to work in his Senate office (your tax dollars at work!), and the guy - even though he never intended this property to be his primary residence, and it never has, takes the Homestead Property Tax Exemption on it.

As a Citizen/Journalist (a/k/a, "blogger"), I wanted to get the story straight from the professionals - you appraisers - just what it takes, and what forms are used, for a legitimate determination of "market rent."

And not that it matters, but having followed Senator Coleman for years, I would bet a whole bunch of dough that if the matter came to a vote, Senator Coleman would vote that "we don't need no stinkin' appraisers."

 

[Restrain]

Washington Post is reporting that Obama got a big break on his mortgage, like Sen Dodd, etc. Wives working in offices are as common as anything in Washington. Check out Rep. Conyers. As to the homestead exemption, you don't have to live there, only state that it is your intent to ultimately live there and not have another exemption.

If you want to check out rents, try this. Go to Craig's list and see what you can find. Go to Realtor.Com and check out what's available.

Just be very careful about neighborhoods in DC. They change in just a few blocks, bad as NYC for that.

I really think you're probably making a mountain out of a molehill given all the other stuff (earmarks, etc) but it's your molehill. Good Luck.

 

[Tommy Johnson]

Actually, It's my understanding

that there's a big difference between Obama's deal, and what Dodd and Conrad got. But, that's a tangent.

What I'm hearing you say, Mr. (Mrs.?) Strahan, is that as far as you know, there isn't an "official form" or "procedure" that's used to determine "fair market rent"?

The point is, inventing my own wheel to determine "fair market rent", leads to the "apples/oranges" argument of how Senator Coleman and his landlord determined "fair market", yes?

And as far as your explanation of "homestead", I can tell you - due to several conversations with the District's Real Property Tax Dep't - that the District would respectfully disagree with your explanation. In fact, they told me that due to my phone call, there now is an official audit underway.

 

[Michigan CG]

.....there isn't an "official form" or "procedure" that's used to determine "fair market rent"?

I do not know if there is a form for determining fair market rent in residential or rental properties. I would guess there is, but more seasoned residential appraisers could most likely find one on their alamode program.

However there is a procedure to do so, as I am working on one right now. There are forms for determining fair market rent for government subsidized housing which I have completed my fair share of. My current assignment happens to be commercial rental space and it is a narrative report (written out book so to speak). The simple procedure is to compare what similar properties rent for and then calculate the amenities (or lack thereof) along with how the lease is written, i.e. who pays for what.

Take a basement apartment, as is your case. You find comparable properties and get all the information you can about them.

For instance let's make some up:

1. 800 SF, separate utilities, on-site laundry, garage; rent $1,600/mo

2. 750 SF, owner pays for utilities, no on-site laundry, no covered parking; rent $1,500/mo

3. 900 SF, tenant pays for electric, landlord pays for all other utilities, washer and dryer hook-up in unit, street parking; rent $1,900/mo

etc......

The value of the size and amenities are all weighed and studied with market evidence and a fair market rent is determined. It is not hard to do depending on the availability of information.

 

[Terrel L. Shields]

Washington Post is reporting that Obama got a big break on his mortgage, like Sen Dodd, etc. Wives working in offices are as common as anything in Washington.

So what? The state of Arkansas taxes the fastest growing industry in the state (gas drilling) which only adds to the misery of the consumer...but GIVES H-P MILLIONS of tax dollars to create a few measly jobs in Conway...As part of that deal they will also HELP THE MANAGERS WIVES AND FAMILY FIND JOBS!.. Crap, what next? Will the state offer child care for them? Perhaps they will get some illegals to mow their lawn and clean the house? Or, perhaps we should pay their cable bill....
Government - "..no honest man can be associated with it.- Thoreau"

 

[Couch Potato]

...Senator Coleman IS the problem, and he has an Ethics Complaint filed against him over this matter. And the guy he's renting from? Senator Coleman does business with him, Senator Coleman hired the guy's wife to work in his Senate office (your tax dollars at work!), and the guy - even though he never intended this property to be his primary residence, and it never has, takes the Homestead Property Tax Exemption on it.

As a Citizen/Journalist (a/k/a, "blogger"), I wanted to get the story straight from the professionals - you appraisers - just what it takes, and what forms are used, for a legitimate determination of "market rent."

And not that it matters, but having followed Senator Coleman for years, I would bet a whole bunch of dough that if the matter came to a vote, Senator Coleman would vote that "we don't need no stinkin' appraisers."

A common saying among appraisers is, "it's not rocket science." Of the tasks appraisers perform, determining market rent is probably one of the easiest in most markets. There are some forms for doing a rent survey, but a form is not a necessity. One merely identifies other similar properties that are rented and uses an appropriate unit of comparison. Units of comparison could be the size (total square feet), could be number of bedrooms or any number of other items. To find market rent one uses a valid unit of comparison between the property in question and the other rental properties.

If you want a solid piece of evidence one way or the other, hire a local certified residential appraiser to do a rent survey on such properties. You ought to be able to get one for a $100 or so.

 

[Tommy Johnson]

The Ethics Complaint concerning Senator Coleman, is here:

http://www.citizensforethics.org/files/Coleman Ethics Complaint.pdf

On page 4, the Complaint requests, and I quote:

"Therefore, CREW respecfully requests that the Select Committee on Ethics investigate this matter to determine whether Sen. Coleman has violated the Senate Gifts rule. The Committee should inqure as to whether or not Sen. Coleman is paying fair market value for the apartment,...."

My original question to the Appraisers visiting this forum was, and again I quote:

"My question to those reading this, is just what steps and what report is required to determine "fair market rent"?"

Apparently, I did not clearly indicate the level of response I was hoping to receive here.



Perhaps I should try again.

"Since Senator Coleman has had an Ethics Complaint filed against him, and the Complaint requests a determination of "fair market rent" for said complaint, what specific report would qualify and meet the level required to support or refute the Ethics Complaint against Senator Coleman?" What professional designation would be necessary to be recognized as an authority to prepare said report?"

Any help would be appreciated; as an official complaint has been filed I doubt this is just a theoretical question.