Property Managers: How to Find Fair Market Prices for your Rentals

Anyone that’s ever rented anything at any point for any reason knows that settling on appropriate price points is the hardest nut to crack. Finding that sweet spot can be especially difficult in the real estate game. If you’re a property manager that’s having a hard time determining how to price your units, the following tips should come in handy.

Check the Official Statistics

Obviously, your starting point as far as rental prices go should be based on simple MLS listings for your zip code. There’s a wealth of data that can be gathered from local government organizations to further guide your decisions. These statistics will give you a vague ballpark figure to work with at the outset. Keep in mind that every area you look at will be slightly different. It will have a different demographic of people and the architecture of that area will also be different. In other words, some areas will be wealthier or poorer than others. This will affect your market prices.

Know Your Target Clientele

Certain demographics are drawn to certain types of properties more than others. For instance, property managers that oversee rentals in the "student section" of a college town should know that their renters will most likely be college kids. Those tenants will often pay more if the real estate is within walking distance of campus regardless of unit conditions.

Accurately Assess Amenity Appeal

Certain rental amenities will be a bigger draw than others depending on target renter demographics and location. For instance, some properties will attract renters more quickly if they have on-site laundry or free Wi-Fi. Knowing what’s important to renters in a certain neighborhood can give you at least $50 to $100 worth of monthly rate leeway. If you also include other amenities such as a pool or a weight room that can also affect how much you can charge your tenants of rent each month in order to maintain the upkeep of these amenities as well. The more amenities that you offer, the more you can charge and the more you will be able to attract potential renters

Crunch the Data to Stay on Top of Trends

Even stagnant rental markets can quickly change as new inventory comes on the market or neighborhood demographic profiles change. A good piece of rental management software such as Rentec Pro by Rentec Direct can help a property manager to see changes coming in advance while reducing overall administrative overhead.

Look at the Local Rental Appeal Factor

At a certain point, rental prices reach a level where it makes no sense to avoid locking down a mortgage. Keeping your rents below that price point is key if you’re interested in retaining loyal tenants. No matter what, make sure that your prices don’t entice your renters towards buying their own places.

One Part Art, One Part Science

Even if you live to be 1,000 years old, pricing a rental perfectly on the first try is impossible. It takes a head for numbers along with an ESP-like intuition to zero in on the right number without a lot effort. Regardless, you can simplify the process using the tips spelled out here.