"Every week a property sits vacant, there is a 2% loss of the total potential annual rental income. You can write off expenses; you can't write off lost rent. Price your property properly and start the revenue stream."
Occasionally, an owner will want to list their property lease rate higher than our recommendation. The lease rates that we set on a property are derived based on a data-driven approach. Austin is unique to other cities in that our Multiple Listing Service not only contains sales listings but also lease listings. Despite what anyone tells you, the #1 place that property is leased in Austin is through the MLS system. This system provides a rich database of active properties for lease and those that have leased.
By having a property manager that thoroughly knows your property, they can compare apples-to-apples when doing their research. They start by pulling listings specifically in your area that are comparable in size and age. They then take into consideration the condition and finish out of your property versus the listings in your area. They also look at what the current Days on The Market are for listings in that area. All these variables and our experience are then taken into account when setting the lease rate.
We understand that time is of the essence and that neither party wants a vacant property. Like you, we, too, want to avoid leaving money on the table. So our price is right in the sweet spot. Not too high and not to low. Our 33 years of property management experience has consistently shown that testing the waters with a high rent price is an inadequate approach to getting the property leased. It is better to slightly underprice a property (yet be competitive) and rent it more quickly than to try and maximize the rental income but have it take longer to rent. Here's a quick workup on the downside of overpricing.