How we estimate rent on 6,500 listings, and where the estimate is wrong
On this page
The DSCR on every listing is only as good as the rent we plug into it. Nobody can tell you what a house will rent for without standing in it, so instead of pretending, we show you the source next to every number and label how much to trust it. This is how that works.
The ladder
For each listing we try these in order and stop at the first one that has enough data:
- ZIP + bedroom comps. The median asking rent of currently listed rentals in the same ZIP code with the same bedroom count. We only use it when there are at least four of them.
- HUD Small Area Fair Market Rent. The federal government publishes a rent figure for every ZIP code and bedroom count, updated each October. It's the 40th-percentile gross rent for the area, which is the number Section 8 payment standards are built on. Since this week we carry the table for every ZIP in the country, not just Indianapolis.
- ZIP comps, any bedroom count. Median of everything for rent in the ZIP, at least six samples.
- Bedroom comps, whole metro. Median of all 3-beds in Indianapolis, for example.
- The 0.8% rule. Price times 0.008. A guess. We label it as a guess.
The source shows on the card as "ZIP + bedroom comps", "HUD fair-market rent" and so on, so you never have to wonder which rung the number came from.
The confidence label
Next to the DSCR you'll see high, medium or low confidence. It combines two things: how deep the rent comps are, and whether the tax figure is the county assessor's real bill or our 1.2% assumption.
| High | 8+ ZIP + bedroom comps AND the assessor's actual tax bill |
|---|---|
| Medium | ZIP + bedroom comps, HUD rent, or ZIP comps, with either real taxes or 8+ comps |
| Low | anything thinner than that |
A "low confidence 1.35" is not better than a "high confidence 1.22". Treat it as a lead to verify, not a result.
Two guardrails
Asking rents in a hot ZIP can produce absurd numbers on a cheap house, so we cap the estimate at 1.4% of the list price per month and say so on the card when the cap kicks in. And new-construction listings often carry a $10 to $200 assessor bill from the empty-lot year; we throw those out and fall back to the 1.2% assumption, again labelled.
Where it's wrong
Asking is not achieved. Comps are what landlords are asking today, not what tenants signed for. In a soft month the two drift apart by 5 to 10 percent. Our own Rocky Ripple house is listed at $2,700; we'll tell you what it actually leases for.
HUD is a different clock. The FY2027 SAFMRs took effect this October and lean on last year's data plus a trend factor. We assumed a 40th-percentile figure would run below asking rents. We checked, and in Indianapolis right now it doesn't: across the 2,800 listings where we have both a live ZIP + bedroom comp and a HUD figure, asking rents sit at roughly 0.8 to 0.85× HUD depending on how you weight the ZIPs. Left alone, that would have inflated the DSCR on the roughly 40% of listings that fall back to HUD by 15 to 20 percent. So the HUD fallback is now scaled by the ratio we actually observe, recomputed every time the rent comps refresh, and the card still says "HUD fair-market rent" so you know it's the fallback. The lesson is the same either way: never trust a published rent table without checking it against what landlords are asking this month.
Condition is invisible. A gut-renovated 3-bed and a tired 3-bed in the same ZIP get the same comp. The estimate is a neighbourhood number, not a house number. That's what the showing is for.
What we'd tell a friend
Use the DSCR on the card to decide what to look at, not what to buy. Before you write an offer, call one Indianapolis property manager, give them the address, and ask what they'd list it at and how long it would sit. Put that number into the analyzer instead of ours. If the deal still clears 1.20, you've got something.
Triad Global
Run the same underwriting we run before we buy — rent comps, DSCR, and price per square foot against the ZIP.
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Written by Triad Global
Triad Global, LLC is an Indianapolis rental-property owner-operator run by a small partner team. We buy, hold and manage single-family and small multifamily rentals ourselves, and we built the free tools below because we needed them for our own underwriting.
