Property Manager | How to Determine Price of Rent
You’ve made the jump into property investment and purchased a single-family home to rent out—Great! Maybe you’ve even completed the remodel and the unit is move-in ready. Before you start marketing your home for rent the most important thing you need to determine is what you are going to charge for rent.
Here are the things a property manager needs to take into consideration when assigning a rent value to a home:
- Home Value- The rule of thumb is to charge between .8 and 1.1% of your home’s value in monthly rent. A home that has a market value of $250,000 can be expected to charge anywhere from $2,000-$2,750 for rent each month.
- Market Rent- Just because the formula for figuring out rent determines you can charge thousands per month doesn’t mean you should. A great property manager will survey the area and find out what others are charging for similar single-family homes in the area. Keep rental prices comparable to remain competitive in the neighborhood.
- Repair Costs- If you had to invest money into the home to get it rent-ready you should take these costs into consideration when determining rent value.
- Upgrades- Is the property full of modern amenities, appliances, brand new carpeting, freshly painted walls, a new roof, landscaping or other upgrades? When determining the rent amount, if you’ve made upgrades to the home you can charge higher end of the rent range.
- Rent Control- Are there laws and ordinances in the neighborhood that determine maximums that can be charged for rent or deposits? Many communities put a cap on rent and no matter how luxurious your home is, you might not be able to charge what you would like for the property.
Once you determine the rent value you want to charge your next step is marketing the home and getting tenants to apply. A property manager in Charleston is the perfect solution for every step of your rental property needs.
If you’re ready to hire a property manager, call Scott Properties at 843-972-9008.