Since 1986, residential rent property management in the greater Austin area
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Distinctive. Reliable. Innovative.
SERVING AUSTIN’S INVESTORS SINCE 1986

Don't overprice your rent property

Every week that a rent property sits vacant, it loses 2% of the total potential annual rental income.

Our years of rental property management experience has consistently shown us that testing the waters with a high price is bad idea.  It is better to slightly under price a property and rent it more quickly than to try and maximize the rental income but have it take longer to rent.


Example #1:   Your goal is to maximize your rental income.  You know you can get $1500/month for rent.  The property is rented in 60 days.

Rental Rate:              $1,500/month

Time Vacant:              2 months

Annual income:         $1,500/month x 10 months:                                        $15,000

Expenses:                 Water, electric, landscaping for 2 months                       $330 (or more in the summer)

Annual Net Income:                                                                               $14,670


Example #2:   Your goal is to rent the property quickly so you sacrifice $100/month in rent and advertise the property at $1400/month.  The lower price increases the demand for the property and it is rented in 30 days:

Rental Rate:              $1,400/month

Time Vacant:              1 month

Annual income:         $1,400/month x 11 months                                       $15,400

Expenses:                 Water, electric, landscaping for 1 month                       $160

Annual Net Income:                                                                            $15,240


By reducing the rental rate by $100 per month you have increase your annual net cash flow by $570.00

We also find: 

1)  Leasing is not like buying, tenants don't typically make an offer on a rent property and try to negotiate.  If the lease rate is what they want to spend, they will look at it.  If it's over-priced compared to the others in the area, they won't even look at it.  

2)  As it sits empty, the Days on Market (DOM) count on the listing keeps going up.  As that number increases the listing gets stale, agents and tenants begin to think there's something wrong with the property.

3)  Most agents will search for listing based on what people want to spend.  If your price is to high it won't come up in their search so they won't know to even look at it.

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We will perform a Market Analysis and make a recommendation for what your lease rate should be.  This is done by comparing properties like yours to other homes that are on the market, those that have just leased and how many days it took for those properties to lease.  

Homes that are priced correctly and in good condition, lease quickly to the best tenants.  Those that are overpriced or in poor condition, just sit empty.