As a property owner, you should put much consideration into the amount of rent to charge your tenants. You must set a price that will allow you to make a profit, but it can't be so high that you face vacancies.
It goes without saying that you can't just make up a number. There are many different elements that you'll need to assess in order to determine a reasonable rent price.
In this post, T.E. Johnson & Sons will go over everything you need to know to price your Winston-Salem home to rent.
1. Age of the Property
Any property's age will affect its rental value.
The newer your home, the higher you can price the rent. Contrarily, the older the home, the less you can charge for rent.
Tenants will be more willing to pay a high for a rental that is newer.
If you're looking to increase your rent, but your property is quite old, then consider a remodeling project. When remodeling, do market research of the popular amenities that other property owners have invested in. This will help you to match your market's competition.
2. Compare Rental Prices of Similar Properties
Look at other rental listings in your area. This will help you determine the local competition and get an idea of the rent range.
Look for homes with comparable square footage, number of bedrooms and bathrooms, and amenities. You can contrast these characteristics to determine a rental pricing range and average.
3. Speak with Real Estate Experts
Property managers and real estate brokers work in the market every day. Get a second opinion on your rental price from a real estate expert. A real estate expert will offer advice on your investment choice if you are new to the field.
Property managers have the experience and can help you know how to price your home according to the area's amenities, location, age, and current rental market.
4. Think about the Amenities Provided
Tenants are willing to pay more for specific amenities and luxuries.
If you have appealing amenities, you can charge more rent for your rental homes. For instance, tenants are willing to pay more rent for properties with backyards and swimming pools. These enhance the appeal of rental properties and may also raise their resale value.
Other amenities that can raise your rent include:
- A balcony
- A deck
- Laundry and dryer machines
Particularly in metropolitan locations, renters are also ready to pay for parking spots close to the apartments.
Offering unique amenities influences how rental units are priced.
5. Investigate the Anticipated Appreciation
Price may vary depending on the neighborhood's future developments. If there are plans for positive development, such as the construction of a sizable mall, the extension of light rail to the neighborhood, or the relocation of a significant new employer, then there's likely going to be strong future property appreciation.
Even modest progress, like proposals to expand a road network or construct a new school, might be encouraging.
New dwelling construction can go either way. It could indicate that the neighborhood is popular and will likely have high demand in the future, enhancing the value of your Winston-Salem investment property, or it could lead to an oversupply of housing, lowering the value of all the homes in the neighborhood.
6. Location
The location of your property can affect the rental price of your unit.
When choosing a home, convenience to schools, shopping centers, dining options, downtown, and high-employment areas are important considerations for almost all home buyers.
If your unit is far from all these things, you won't be able to charge as much rent.
7. Right Rent is Determined by Market Demand
Pricing your rental is not a one-time process. You must continuously monitor the market and change the rent as necessary to meet demand.
For instance, when the economy is weak, the demand for rentals may increase as a result of individuals being obliged to rent rather than buy homes. So, since demand is high, you may be able to charge more for rent.
In other words, you can raise your rent when there's an increase in demand for your property. You may need to reduce the rent when there is less demand to draw in tenants.
Conclusion
A key component of operating a profitable rental business is determining the appropriate pricing for your rental property. It takes time, effort, and resources to price a rental property fairly.
You don't want to set your rent too high or too low and lose out on potential income.
Setting the rental price is not as simple as most property owners believe it to be, which is why it's crucial to enlist the assistance of property managers like T.E. Johnson & Sons.
We place the utmost importance on open communication with landlords and tenants. We aim to meet your property management requirements and offer prompt, competent property management services.
Contact us today for more information.
