Hi, I’m Faye with Residential Property Management in Portland. Today we are talking about how much rent you should be charging for your property. Setting the right rent for your home has a major impact on your vacancy time and your bottom line. It’s fairly easy for us to do at Residential Property Management because we price rental homes every day, and we have a good feel for what the rental market is doing at any given time.
The most important piece of advice we can share with you when pricing your home is to use facts, not emotions. The rental market doesn’t care what you need per month to cover your mortgage and other costs. The market only cares about value. When we make a price recommendation, we start by comparing your property to similar rentals in the same area with comparable amenities. We also take a look at what those properties have rented for in the past, which helps us suggest an asking price.
You don’t want to overprice your rental home. When you set a price that’s too high, it will create some additional downtime for your property, and that longer vacancy will create lost revenue that you will never be able to recover. If your price is too high, leaving the property vacant for 30 days longer than if you had reduced the price by $100 per month, it’s going to take you a long time to recoup that loss of rent for 30 days. It would have saved you money to price it lower. Be realistic about how much rent you can reasonably charge. The most successful landlords are those that have the smallest vacancy loss, not the highest rents. Those landlords collect more rent dollars over a twelve month period because they don’t have vacant properties.
Our goal as professional property managers is to attract and retain the best possible tenants. Setting a price that’s too high will also come with the risk of attracting someone who is a little more desperate to rent your house. If your home is priced too high for well qualified tenants, you will likely get applicants who have been turned down at other places and they just need to find housing. They will be willing to pay more because they have limited options. You’ll be better off with a more reasonable price and a highly qualified tenant in your home.
This is just a general direction on how to price your home for the rental market. If you have any questions at all about how much rent to charge for your property, please do not hesitate to contact us at Residential Property Management, and we would be more than happy to help you.