One of the key questions on the mind of a potential landlord must be determining the rent of his/her property. If you are planning to rent your home, you are probably working out the expectations and constantly thinking ‘How much rent should I charge?’ Inconsistency is one of the features of the real estate market. This being said, the costs of properties, amenities and ultimately rent rates keep fluctuating. While there are no standard sets of numbers, you can definitely consider certain factors that will assist the decision-making process. Doing your research and understanding the structures that relate to what your rental amount will be will certainly bring you a step closer to making a good decision.
Here are a few factors that influence the rental value of a property:
This is one of the main factors responsible for a high or low rental amount. An upscale neighbourhood will probably have higher rates while properties of the same size in a different location may have a lower rental cost. Another element to location is accessibility; accessibility to convenience stores and shopping centres, schools and transport services as well as highways and motorways. Properties with plenty of accessibility will definitely achieve a premium rental yield.
Number of bedrooms and Bathrooms
This is the most obvious factor that is taken into account while determining the rental value of a property. Tenants will pay more for properties with more bedrooms and bathrooms. A great example is a three bedroom property with one bathroom vs a three bedroom property with a main bathroom and ensuite. The second property has more to offer, effectively increasing the rental value.
Features like a swimming pool, garage, entertainment area and parking space are usually well sorted after by tenants and will help you rent out your home faster at a better price.
At any given time the demand for a rental property in your area could change and fluctuate. This demand could be influenced by the time of the year (i.e. holiday season) and the level of supply (i.e how many rental properties are available on the market). The less supply of rental properties will undoubtedly help you reach a higher rental amount.
A quicker and more accurate approach would be to sort the help of a local real estate agent. Professionals can provide you with the much required access to data and a lot of information on current market trends. Additionally, they can help you with a professional real estate appraisal. Most agents are more than willing to help market the property and can probably point a potential tenant your way.
The rent must always be at a reasonable marketing rate, which can be determined after evaluating all the above mentioned influences. It should neither be lesser or higher than the exact market value. Once you have arrived at a decision, the number of days your property stays on the market must be monitored. If the property doesn’t rent, you may need to adjust the price or market the property better with the help of an agent.
Your first time as a landlord may be a little daunting. However, with enough research, you will be able to successfully rent out your home to tenants at the best price possible. Apart from calculating rent, think of yourself as a prospective tenant and the factors you yourself will consider while renting a home. Speak to the experienced team at All Property People who can offer you professional guidance that will help you increase your rental yield and draw profits faster.