Many people have lost a good opportunity to sell or rent a home because they were not informed during their decision making process. One of the most important aspects of putting a property on the market is the amount you ask for it.
Being far too ‘creative’ with setting your rent can hurt you in the long run. It doesn’t benefit you to have your property on the market for several months- empty. For one, you are going to spend more maintaining the upkeep and this could affect the value over time. Not to mention months of no revenue. If you have one month out of 12 empty and the rent is £1200 per month you are making £1100 per month on average. Isn’t it better to set the rent at £1150 and rent it out immediately?
Online property company The House Shop, which has its own valuation service, says homeowners should do proper research about their property and work with a professional to arrive at a price that’s suitable for both parties (landlord and tenant).
The following steps are important to consider when setting a price:
1. Appeal to the general seeker
The property market is not an easy one, and to ensure you are not the only one interested in your property, consider adopting unconventional methods. Do a thorough research on the average rental price for homes in your neighbourhood, and set yours at a reasonably discounted price. This will stimulate the majority of seekers in the area. This method is especially effective when you want to sell or rent away immediately. You might also get a lot of offers if you are selling, and that will force the price up.
2. The right price depends on the desirability of the unit
Always be savvy about setting a price for your various units. It is counter-profitable to fix a one-price fits all for the units in your property, simply because they share the same building. Unless they are exactly the same, you could lose money. Your rent should depend on:
- The apartment view- does it overlook the sea, or the main city centre?
- Renovations- have you recently upgraded the unit?
- Layout- design and plan
- Floor level- A top floor apartment may be more desirable than a bottom one.
3. Don’t get too creative with your price
It’s not unusual to see the recommended retail price (rpp) of a flat screen TV set at £799.99. There is a reason for this and it doesn’t exactly work in property pricing. Therefore, I was surprised when a client whose flat, between the range £700 and £800 and month, was asking for £797.97. Setting your rent at such an odd price draws attention, and not in the right way. More like how you would consider an indigo painted house. Keep your price simple, and beware of leaving traces of the ‘seller’ around.
4. Pricing is a continuous discussion
Always pay attention to your agent, they have an in-depth idea of the property markets, so expect to keep a discussion going. Being adamant about your price could hurt you eventually. It is disappointing to have a property sit so long in the market. Open your mind to alternatives, and note that pricing depends on many factors:
- Other rental prices
- The nature of your property
- The market at the time
- The neighbourhood
By being flexible with your rent charges, you make room for more opportunities and increase your chances of renting.