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There are plenty of reasons homeowners put their houses up for rent. From bringing in extra income to having the flexibility to travel, turning your property into an investment comes with a range of benefits.
But if you’re thinking of doing this, you’re probably wondering how much to charge for rent. We’ll answer this and more in our helpful guide as we cover the best tips and tricks for fine-tuning your rental price.
If you’re considering renting out a property, your first question most likely is: how much can I rent my property for? Though there’s no easy answer to this question, there are a number of factors that influence the price you should charge for rent. It’s important to find a balance between your income as a landlord, and getting tenants into your home with a fair price. The current real estate market will play a role in determining your rental rate. From the neighborhood to seasonality, here are some things to consider before you figure out exactly how much rent to charge.
Throughout the United States, neighborhoods located within the same city or town can vary greatly from street to street. There will be a higher price point in more sought-after neighborhoods and a lower price point in other areas. What this means for you is that you must do your research as a landlord. Understanding your rental market can help you manage your home as an investment property. Use resources that help you figure out what homes are going for in your neighborhood. When asking how much should I charge for rent, you first want to figure out what your neighbors are charging. If there’s someone down the street with a remodeled two-bedroom home that’s going for less than your non-remodeled one-bedroom, it’s time to go back to the drawing board. The good news is that once you familiarize yourself with the neighborhood, you can know how much rent to charge that’s fair for both you and your tenant.
In most areas of the country, seasonality plays a part when you’re trying to figure out how much rent to charge. This has to do with several factors. Families don’t want to start a lease in the middle of their children’s school year or have the hassle of moving during the holidays. In the winter, cold temperatures in certain parts of the country make it easier to hunker down inside with a good book and a cup of hot chocolate (rather than trek through the snow in a moving truck). If you decide to rent during the summer when demand is higher, you might be able to charge more than you would during other times of the year. This is especially true in coastal areas, places near water, or spots people seek out during the warmer months. Although you don’t want your property to sit vacant, finding the timing where demand, seasonality, and your rental listing is ready can sometimes make a short wait worthwhile. A prospective tenant will view your property differently depending on the season.
In addition to knowing your neighborhood and taking seasonality into account, another thing to do when asking how much can I rent my house for is to consider comparable properties. Look at the average rent of nearby properties to help figure out your potential rental yield. If you have an apartment in the city, look for comparable properties that share some of the same features. Maybe your apartment has a gym and a pool, which adds value for your tenant and means you can charge a higher price than similar properties without those features. One of our top vacation rental tips for owners is to start with making a list of every detail about your property.
Once you answer these questions, you’ll be able to share the value of your particular rental spot with future tenants. Remember, every rental is different—it’s up to you to find out what makes yours shine (and if you don’t know what that is, the Zeus team will be happy to help).
In certain places, like New York City and California, rental control laws place regulations on rent increases for tenants. Rent control varies between states and cities, so before you set your price and decide how much should I charge for rent, be sure to familiarize yourself with what rent control looks like in your neighborhood. You want to come up with a rental price that is comfortable for you and your tenant for the duration of the lease term. Once the lease term is up, reassess the price and make sure it still works for you (just remember, you can avoid tenant turnover by making the price fair and accessible for your renters).
Having a successful rental property has a lot to do with how much value you’re offering to your tenants. If you want to increase your rental value before you list your property, here are some things that will help you do so.
For those landlords who have a knack for interior design, consider furnishing your space before you put it up for rent. The demand for furnished rentals, especially for short term stays, is high. This is because everyone from traveling nurses to students to journalists on-assignment are searching for clean, comfortable furnished rentals. When business professionals must travel away from home, they want a place where they can relax on the couch after a day of work or a kitchen where they can put on some music, cook, and unwind. Similarly, families and solo travelers are always on the hunt for charming, creative, and cool vacation rentals. After all, what would a vacation be without an Instagram-worthy spot to share with friends and family? You don’t have to shell out a bunch of money to make your furnished rental shine, either. Just stay true to a style that appeals to you and your potential audience and go from there.
Some tenants prefer to handle utilities on their own, while others like the idea of utilities coming in one lump sum with the rental. The bonus of adding utilities is that if someone is searching for a rental in a given price point, and they like yours, having utilities already included will add value. Whether or not you choose to include the utilities or not, keep this in mind as you decide how much should I rent my house for.
When tenants are searching for properties, whether these are short-term, long-term, or vacation rentals, they want to know what appliances are included. A washer and dryer, for example, not only ensure they don’t have to pay more money for visiting a laundromat, but it adds convenience and comfort. The same is true for a dishwasher or a nice refrigerator. Investing in new appliances means that you can increase your monthly rent (and alleviates any stress down the road for you or your tenant that the old appliances may break or stop functioning properly).
Once you’ve figured out how much rent to charge, you can move on to the next step of listing your property. Many people wonder “do I need a license to rent my house?”—so before you dive into posting your r ental, you want to legally protect yourself and see what your state law mandates. Once you do that, you’re ready to list.
A website is a great way to advertise your rental. Use search engine optimization practices to spread the word and ensure that your rental pops up when users are using the web to find their next home.
From Craigslist to Zillow, many homeowners turn to online resources to post their listing with images and sort through the responses from interested potential tenants.
If you want to make renting out your home as easy as possible, go with Zeus. When you sign a revenue-share lease with us, you can enjoy hands-off, full-service property management. With rentals all across the San Francisco Bay Area, Los Angeles, Seattle, Washington, D.C., New York Metro, and Boston—we know a thing or two about creating home-away-from-home environments with happy tenants. To see if your property qualifies, visit our website, enter your address, and we’ll send you an offer.
Whether you’re using Zeus or deciding to rent your property yourself, we know you’ll find the perfect tenants who will love your home as if it’s their own! Once you’re able to answer how much should I charge for rent?—the rest of your rental process will be smooth sailing.