The Importance of Proper Pricing
Your home is finally ready to be listed on the market. The work orders have been completed. The home has just had professional marketing photos completed and all that is left is to finalize the rental rate of the home for the listing.
This decision can be the difference between your rental property getting rented as soon as possible or sitting on the market for way over than you initially anticipated.
In general, if the property is listed at the right price it should rent within 30 days. For the case sample that our Director of New Business and Marketing, Keith, is going to discuss in the following video this home was listed on the market for about 80 days before it was rented.
This home, unfortunately, did stay on the market for an extended time period due to the rental rate being too high. This property was originally listed at $1,650 and ended up renting for $1,575. We originally recommended the rental rate of $1,550-$1,575. The difference between these rental rates is $75 which is a difference of $900 over a year. Although, since the home sat on the market vacant for an extended timeframe this resulted in more of a loss for the owner.
The rental rate of your property should be determined based on the following factors.
- Regional Market Analysis. This will include all demographic and economic information for the subject region. For your information, this analysis should be completed every year.
- Neighborhood Market Analysis. This will include all the important information pertaining to the rentals in the subject neighborhood. Major factors to consider in the neighborhood analysis are land usage, supply, and demand, as well as neighborhood amenities and facilities.
The rental rate will be the final result of the regional and neighborhood market analysis. Property managers will work through this process and take a look at the comparable rental properties in the area. Even so, it is good practice to keep an open idea to other objections that could effet the rental price.
Other items to keep in mind are:
- Overall square feet
- Historical/Current rental rates
- Vacancy rates
- Age special features
- Overall condition of the property
If there is any additional information that our team can provide for you please let us know.
We look forward to working with you soon!