Choosing the right price for your rental unit

It’s important to know the value of your rental unit when you’re thinking about looking for a tenant. However, all to often, landlords just kinda “wing it” when it comes time to set the price. As landlords, we want our rents to be as high as possible, while our tenants want exactly the opposite.  Somewhere in the middle is where the price should be set. But first, here are a few things that you should consider:

1.     location-Location-LOCATION: It’s extremely important that you consider the location of your property when coming up with price. If you’re located in a very prestigious area, you can command higher rents. However if you generally wear a flak jacket when you visit the property, or if you often find yourself cleaning up chalked sketches of bodies from the sidewalk in front of the property, you’re probably not going to be able to charge very much for that particular unit.

2.     Amenities: Units that come with useful amenities usually yield more in rents. Does your unit have off-street parking or a garage, a dishwasher, internet access, laundry facilities or secure building entry? These are just a few out of thousands of amenities that you can offer to attract a higher paying tenant.

3.     Size Matters: You should certainly consider the size of your unit when contemplating pricing for your unit. The more bedrooms – the more you can charge. The more bathrooms – the more you can charge. The more general square footage – the more you can charge etc. etc.

4.     Property Condition: This is very important when considering the price. If you have a lot of differed maintenance, that will severely lower the amount that you’ll be able to charge for rent. However if the property is in pristine condition, you can naturally charge more.

You should also check out the competition. Check Craigslist, your local newspapers, pick up one of those free apartment books at your local grocery store, call a few for rent signs and see what their charging. This will help you to get a greater understanding of how much your local market will bare for your rental unit.

Keep in mind that if you are experiencing a deluge of prospective tenants trying to break down your door to rent your unit, it’s probably priced to low. On the other hand, if you’re getting little to no calls, it’s probably priced to high.

One thing that you should always remember is that we as landlords don’t set the market price, tenants do. You can ask for a million dollars a month for your rental but no one will rent it until it’s priced to fit the market.

I hope this post helps you find the right price for your rental. Contact me at www.MyInvestingAgent.com if you have any questions.