If you'd like to retain your property but want to relocate, renting out your house is an easy option. Moreover, if you've got a mortgage on it, picking up a tenant can help you pay it off more quickly. Or you can simply put all the money you've earned on a special retirement account.

What you need to start with is setting up your rent charge. How much should you ask for? Here are some tips to help you find out what you need to take into account when setting up your rent.

First, you should have an idea about how much your home is currently worth in the market. Expect this amount to be completely different from the price you originally paid for your property.

How to estimate your home value?

Try a website like Zillow to find out how much your property is worth at the moment. You can also find an experienced real estate agent or home appraiser to help you accurately assess the worth of your home, including factors like its condition, local sale prices and its location.

Why do you need to know how much your home is worth?

This amount will help you to estimate the rent you should charge your tenants. It should basically correspond to a percentage of your property's market value. Rents that landlords typically charge fall between 0.8% and 1.1% of the home’s value.

For instance, if a house is valued at $250,000, as a landlord you could easily charge between $2,000 and $2,750 each month.

What to do if that percentage doesn't suit you?

Sometimes the formula described above doesn't work. If your property's value is $100,000 or less, it's a good idea to charge rent around 1% of your home’s value.

However, if your house is way more expensive and worth more than $350,000, you should modify the formula and charge a little less to attract more tenants.

Charging a rent which is too high will mean less potential tenants. Nobody wants to spend lots of money on renting a property – your rent charge should be low enough to convince people that renting is a better idea than getting a mortgage for buying a property.

What do landlords charge for homes in your area?

Your next step should be to find out how much other landlords charge for similar homes in your area. If your rent is unreasonably high, finding a tenant willing to commit to your terms will be difficult.

Do some research yourself on websites like Trulia or Craigslist to find out how your rental rate competes against the rates offered by your competitors on the rental market.

Other important factors that affect your rent charge

If you’re renting out your property to pay for your mortgage, you should factor in this aspect as well.

Remember to count in the estimated repair costs, additional annual property taxes, homeowners association fees and insurance expenses.

Some states limit the amount landlords can charge for rent, as well as late fees and security deposits. Find out whether rent control laws exist in your location and make sure to follow them – otherwise finding a tenant will be next to impossible.

Renting out your property is a great idea if you'd like some cash or are looking for a smart way to pay off your mortgage. Factor in all these things and you'll be on your way to setting up a rent price that attracts plenty of tenants and keeps you satisfied.

Jessica Gust is a Marketing Assistant at Localpeek.co.uk - a new postcode finder