How much is my guest house worth?

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A couple years ago, my wife and I renovated a guest house on our property, and are now earning about $ 900/mo in rent, which gives us an extra $ 9,000 per year in pre-tax income. We are in the early stages of planning a move. Our regular house — assigning zero value to the guest house — would probably sell for $ 625,000. How much extra should we add to the asking price of the house to take into account the rental income from our guest house?

3 Comments
  1. Reply
    Marfield B
    July 17, 2011 at 6:36 pm

    its easy look up to google check your area code and find which house suits you.

  2. Reply
    goz1111
    July 17, 2011 at 6:44 pm

    if it is a legal unit, then i would go with the rental amount per year multiple by say 7 to 10 depending on your area

  3. Reply
    Nancy
    July 17, 2011 at 7:18 pm

    I would say $ 700k-725k for both. If the guest house is at least 3br/1.5 bath, I may even suggest as high as $ 175k additional if it is in a very pricey neighborhood.

    Good luck with it!

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