Although each rental market differs across the country, there are a variety of ways in which a landlord can determine how to price a rental property in their own geographic region. Following are some great resources and ways to make sure the price is right:
Facebook Marketplace;
Craigslist;
Other local websites geared to tenant searches; and
Rental property management websites
These online resources can all give a landlord the information they need to confirm whether or not they are priced accurately in their area.
Comparing the number of bedrooms, bathrooms, appliances and other features such as in-suite laundry, fireplaces and the type of heating system will ensure a rental property is priced fairly and at a competitive rate. Do other landlords include the utility costs or internet service? Who does the yardwork? These all affect the rental rate and can be a determining factor for a prospective tenant.
Be Flexible
Once a fair market price is determined, don’t be inflexible. If, after a number of showings or calls, the property hasn’t been rented, look at why that might be. Are there deficiencies with the property itself that may be putting people off? What feedback has been received about the property, its features, location, or price? Are there repairs or updates the Landlord can do to make the property appear more marketable?
It’s also important to know the “bottom line” price especially if the rent is needed to cover a mortgage payment or other financing. Keep in mind though, that if the price is too high, there won’t be any interest. Alternately, if there is an urgency in getting the property rented, price it a few dollars lower than the competition and the interest will be there! Even $25 a month can make a difference for potential tenants.
Landlords don’t want to lose a great potential tenant over a difference of a few dollars, so being able to move the price for the right tenant is something to be considered. It’s much better if the property is occupied by a good tenant paying a bit less per month than to have the property sitting empty for a month or two or sometimes even longer.
USE A REALTOR OR PROPERTY MANAGER
Experts in the real estate industry can provide information relating to the current market conditions in the area. They can also provide rental or tenant placement services. They have the experience and knowledge to accurately price the property and to make the rental process simple and painless for landlords. In addition, they may have resources not available to an individual Landlord, such as the ability to do credit checks. Real estate professionals generally have a thorough screening process that includes:
Employment verification - how long has the person been employed, what do they do, how much do they earn and is it sufficient to cover the rent? Landlords can determine if the applicant is reliable, a hard worker or sometimes, something else.
Landlord checks - past and present. Generally looking at a minimum of five years will provide a good sense of the type of tenant the prospect will be. Did the applicant pay rent on time, look after the property to a reasonably clean condition or cause damages that weren’t repaired? One key question to ask every previous and current landlord is would they rent to the person again - that will tell you just about all you need to know about the kind of tenant they were.
Personal reference checks or character references. Although friends and other personal references won’t generally say anything negative, landlords may learn something that will sway the decision one way or the other.
Investigating public records and other information which can provide insight into the potential new tenant. Landlords have to be careful not to discriminate against someone in a way that contravenes human rights laws, the information in public records can provide details about the type of person the applicant is. Some issues may be minor and can be overlooked, but something serious may not.
Social media. Facebook, Twitter and Instagram are often used by applicants and can provide details about the applicant in a less formal, more personal way.
While there is a fee, often one month's rent, to have a real estate professional complete the rental process, some landlords feel it is well worth the cost to ensure a thorough and complete screening is completed on each potential new tenant.
SingleKey offers a comprehensive screening process for landlords on every application they receive. Visit www.singlekey.com for more information.
