If you’re not clear as to when to adjust your rental rates, it might be because you let a whole year go by without doing a market assessment on your rental properties in Birmingham. As rents for single-family rental homes continue to rise nationwide, property owners who are not adjusting their own rental rates every year may be losing rental income. However, you would need detailed market information if you want to be sure that you should raise your rental rates— and by how much. The information will help you set the most competitive price for each of your properties. This is the reason why an annual market assessment is vital to your long-term real estate investing success.
Executing regular market assessments are a key part of owning a profitable investment property in Birmingham. These assessments can greatly aid property owners in identifying the market rental rate for their single-family rental homes. There are different ways to calculate rental rates, but the rate must still be based on the rental market. If you do not base it from that, you may be setting a rate that is too high, making it nearly impossible to rent the property. On another note, if you set a rate that is too low, you’ll also be risking your rental income. But that’s not even the worst thing that could happen. You could also be driving away potential tenants because the super low rate would communicate to them that something is wrong with the property. It really is important to know what the going rental rate is for properties in your local market. This knowledge will guarantee that your rental rates will remain at the same level as what renters in the area are willing to pay.
Conducting a rental market assessment entails gathering information on average rents for rental properties in a particular area. To start, first, identify at least three rental properties that are comparable to yours. Find out what the monthly rent is for each one, and then divide that number by the square footage. Averaging the price per square foot will then indicate what the average rent is for a property like yours. You can then use this data to figure out the most accurate rental rate for your property.
There are other things that must be considered when carrying out a rental market assessment. These include the attractiveness of the neighborhood, proximity to amenities, and access to major roads and public transit. When assessing the local rental market, there are components that can make the rental rate go higher. A neighborhood with smooth roads, nice sidewalks, and pristine properties will have greater appeal and will attract quality renters. Nearby amenities like libraries, shopping, and parks can also be a powerful attraction, as would easy access to major roads and public transportation. All of these elements have to be considered when performing a rental market assessment, giving you the appropriate rental rate adjustments.
Several investors understand that rental market assessments are a significant part of locating and acquiring quality rental properties. Hence, market assessments shall likewise be conducted annually to make sure that your rental properties are keeping abreast with some changes in the local rental market. Regular rental increases can ensure that a rental property continues to be profitable over the long term and remains competitively priced no matter what the local market is doing.
However, one problem is that rental market assessments can take up a great deal of time, and if the inappropriate comparable properties are used, it could result in a significant loss of rental income from extended vacancies or a rental rate that is too low. This is exactly the reason why involving industry experts on your investment team is so important.
At Real Property Management Victory, we offer free annual rental market assessments to each and every one of our property owners currently under contract, including one free rental market assessment to property owners considering our services. By executing a fresh market assessment on each property every year, one in conformity with market expertise and solid data, we assist investors in retaining and keeping their rental properties competitively and accurately priced.
Would you like to take advantage of a free rental property assessment? Feel free to contact us for more information.
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.
