Determining the amount you want to charge for your Baltimore County rental property can be a delicate balancing act. Charge too much and you will surely experience high vacancy rates. Charge too little and your rental property business will suffer in the form of negative cash flow.
So, how do you go about deciding the perfect monthly rental amount?
Here are some tips that you or your rental property management company can follow that will establish a good rent amount that will make both you and your tenants happy.
How to Determine Rent Prices for Your Property
Take a Look at Your Property’s Value
One of the first places most landlords look when determining how much to lease their Parkville property for is the home’s value. The general rule states that a good and fair monthly rent falls within the 0.8 to 1.1% of the rental property’s home value.
Typically, the higher the value of your home, the lower the percentage you will be able to charge monthly for rent. For instance, a home valued at $100,000 could probably easily rent for 1% of the value, or $1,000 a month. On the other hand, a much more valuable home set at $350,000 will probably fetch a monthly rent closer to the 0.8% rate, or $2,800 mark.
In other words, the fact that your Pikesville home is worth a lot does not justify an inflated monthly rate. The only way this would work would be in cases where your property is in high demand, located in an affluent area, and has over-the-top amenities.
Check Comparable Rental Listings
Understanding that your potential Towson tenants will typically do their research when it comes to leasing a home is important when setting your property’s rent amount. Your tenants will know if you have priced your property too high and will go somewhere else to lease, leaving you with a vacant home.
This means you too should do your research and find out the going rate for properties similar to your own.
Look at online ads and in the newspaper. Track this for at least a couple of weeks before setting your amount to account for any abnormal price settings. In addition, try doing the following:
- See which incentives properties similar to yours are offering. Too many special deals may signal an over-saturation of properties available for rent. If there is an overabundance of incentives, you may have to adjust your rent lower than you had anticipated.
- Visit some of the comparable properties. See how they actually compare to your valuable Essex rental property. Further, ask the landlord what kind of interest has been shown in the property to see what kind of activity you can expect on your own property as far as interested tenants are concerned.
- Ask experienced professionals what they feel a fair current market rent amount is.
By investigating the rental rates of properties similar to your own, you will be able to see if charging a higher rent is justified and how likely it is to be leased quickly. If you choose to use Baltimore County’s best rental property management company, this can be done for you. Aggressively marketing your property at the highest possible rate while getting it leased quickly is Bay Management Group’s specialty.
Take Note of Local Amenities
Tenants are more likely to pay a premium price for your Owings Mills property if it is located near amenities such as shopping centers, restaurants, parks, and schools. This is why becoming familiar with your rental property’s surrounding area is a key factor in advertising the value of your property and justifying a higher rent.
Factor in Your Property’s Amenities
In addition to being geographically close to amenities that tenants like to frequent with their friends and family, don’t forget to factor the amenities your Catonsville property has into the monthly rent. Here are some of the most popular things tenants look for while deciding which home to lease:
- Recent Renovations – Highlight any external renovations to the property, this including recently added landscaping decor, a pool, well-maintained foliage, and even on-site maintenance services. Inside your home, some of the most attractive features to offer tenants are new flooring and updated hardware and appliances.
- Parking – Tenants are always interested in where they can park their vehicles, especially if they have more than one. If you have special covered parking, a multiple car garage, or designated off street parking spots, your tenants will want to know. And the more convenient their parking is, the higher the rent can be.
- Utility Inclusions – Including payment of small utilities such as the sewer, water, and trash can make a big difference in how much you charge for rent.
These are just some examples of the amenities that can play a role in how much you decide to charge for rent. The more exclusive the amenity, the higher the rent can be without causing people to look elsewhere.
If you are using a rental property management company to manage your White Marsh property, you can bet they will help you with the advertising your property’s best amenities. In addition, they should be able to give you some cost effective ways of boosting your property’s value. These tips will ultimately help you attract high quality tenants willing to pay a premium rent for a great property.
Other Quick Tips
In addition to the tips mentioned above, here is a list of other tips that can be used to help you determine the monthly rental rate of your Dundalk rental property:
- When your property goes vacant, experiment by trying to bump up the monthly rate a bit. If you do not get any potential tenants within the first week or two, you know that it is too high. You can then lower it back down to a more reasonable rate. The point is, vacancies often allow you to “raise the rent” easily. And, it can’t hurt to try.
- If your property is made available and you have tons of interested tenants, step back and re-evaluate the asking monthly rate. Chances are, you have priced your property too low and everyone knows it.
- Factor in your own expenses for running a rental property business. You have to know what your expected return on investment will be for every rent rate you are considering. Factor in expenses such as the property’s mortgage, interest, property taxes, and insurance. And don’t forget other things such as HOA fees, maintenance and upkeep, emergency repairs, and property management fees. After all, the whole point of leasing your home is to make a profit.
Final Thoughts
In the end, deciding how much to rent your Baltimore County home for can be complex and involves many factors. Luckily, Bay Management Group is here to aid you in your quest to find the perfect sweet spot when it comes to a monthly rent rate. We can help you with everything including property advertisement, amenity upgrade ideas, and making your home competitive with other rentals in the nearby area in regards to both looks and price.
Call us today and see how we can help you set a competitive rent and keep high quality tenants in your home for the long haul. Have the peace of mind that your home is in good hands and is bringing in the highest return on investment possible by using Baltimore’s Bay Management Group.
Factoring in your properties amenities is a great idea for determining your rent amount. If your property recently went through a renovation, increasing the rent would be a good way to pay off that construction. It would also help to include things such as an in-unit washer and dryer unit.