If you’re a landlord or someone trying to rent out property and that property has sat vacant a lot longer than you planned, lowering the rent might sound like a great idea. However, there are several things you should consider before making a move like that – it could make or break your overall profits for that particular property or multiple properties you’re trying to rent.
There’s no secret that every property is different and every property owner’s situation is unique to the individual, but in most cases, there’s one thing that everyone should analyze, whether it’s your first rental property or if you’re a seasoned veteran: the price you’ve set.
When the Rent is Set Too High
If you’ve struggled to find a renter for your property, the natural train of thought is to wonder if you’re asking for too much money. However, thanks to industry data, advances in technology and the creation of tools to help property owners just like you; you don’t have to go on wondering. One of the best ways to determine if the rent is set too high is to do one or all three methods listed below.
Method # 1: Have An Appraisal Done: Chances are that you’ve already had an appraisal done – back when you purchased the property you have listed for rent. However, having a fresh appraisal done can provide you with additional insight into what could be the reason your property has gone vacant for so long.
What’s really great about an appraisal is that the appraiser does everything for you:
- Valuing your property
- Providing an estimate for rent
- Comparing its desirability apple-to-apples to nearby competitors
This comparison will empower you with vital information not only about your property, but also properties near you that people have chosen to rent based on the price, location, amenities, etc. This will allow you to make any necessary adjustments that may be hindering your chances of attracting renters.
Method #2: Utilize Online Rental Price Estimator Software
This is a smart and quick way to know for sure if your rent is too high and in some cases if it’s not high enough. Take advantage of online rental tools, such as:
- Zillow’s Rent Zestimate
Just like Google’s search engine, using both of these tools, Hotpads and or Zillow’s Rent Zestimate, work in a similar fashion in the fact that they both use algorithms to provide you with rent prices based upon properties in your local area.
Method #3: Get a Free Rental Analysis. Having an appraisal and, or utilizing rental price estimator software tools that are available are great to start with. However, both have some shortcomings or lack additional information in which the average property owner needs to actually find a renter and close the deal. There are many intangibles and variables that make one property stand out from all the others – and attract those looking to rent.
However, a free rental analysis offered by industry experts will empower you with insights to leverage your property over everyone else. The analysis can, for example, provide you with data such as properties near you that may have the exact same rent price as yours, but the property does not offer a washer and dryer. If your property does offer a washer, dryer, or whatever else the rental property near you does not offer, it equips you with a competitive advantage that you can highlight while adding more appeal and interest to your property. But in the end, you’ll know if lowering the rent is the answer. Click below to get our free rental analysis so you can start maximizing your investment today.