It’s no surprise that owners of rental properties want to get top dollar in rent to offset their costs. But, did you know that asking for a rental amount higher than market rent can often backfire? Here are eight tips on getting the rental price right:
- Walk through your home and evaluate your home on a scale of 1-10. If your home is a 10, this means it is in perfect condition with all the upgrades, bells, and whistles. Scoring your home will help you to price it correctly within the market range.
- Perform a rental market analysis at rentrange.com or another similar site. This will cost you approximately $20, but a market analysis is a great place to start; the analysis will give you the median rental price based on rental homes similar to yours in the neighborhood. Don’t want to pay for the analysis, please call our office and we would be happy to provide you with a rental market analysis.
- If you’re looking at comparable properties online, subtract 5-10 percent. Remember that what you see online are “asking” prices and not “actual” rents.
- Be honest with yourself and adjust your rental price based on your home’s condition. Use the score you gave your home in order to place it properly within the range. Most homes for rent are in “slightly above average” to “good* condition. If your home is in “excellent” condition, adjust accordingly. If it’s in “average” condition, reduce accordingly.
- To find the best tenants, price a home slightly below market. Tenants with high credit scores, great income, and excellent rental history will have a lot of choices at their disposal, so it’s a good idea to offer a break to open up your prospective tenant pool. Research shows that tenants with excellent rental histories stay longer (reduced vacancy) and cause fewer headaches (less maintenance).
- If you are not getting 2-3 inquiries per day, then your home is priced too high. Reduce it in increments of $100.
- Don’t listen to your friends or neighbors, unless they are licensed local property managers who know the market, they will always suggest a rental price that’s too high.
- Have your rental price end in $90 (e.g., $2990 instead of $3000) for the psychological factor and online price search filters.
Looking for more assistance with property management? Please call the dedicated team at Broadpoint Properties.