How do you fix a price point for an apartment? Take a guess? Figure it based on your carrying costs? Check comps and do a market analysis? Charge whatever the market will bear? If you're looking to place quality tenants, less is sometimes more.
We all want to make money with income property; the more the better! When you're looking for a new tenant, however, don't assume that you're going to make more money by charging more. If your property is priced high for what you're offering, you won't get a lot of calls, and the ones you do get will be either uneducated about your local rental market, desperate, unscrupulous, or a combination of any of these.
What to do? Perform your due diligence: check the advertisements for similar apartments, make appointments to look at them, talk to real estate agents and others in the business, and get a clear idea of how much others are getting ? not just charging ? for similar rentals. Then, advertise yours to undersell the competition.
Why undersell? It's a basic rule of economics that price is a great way to compete. If you offer a good product for slightly lower, you'll get a lot of calls, which means you'll be able to screen more applicants and get the best possible tenant into the unit. Once you have a quality tenant that likes the place, you're golden ? you can make increases annually that put your unit in line with others. Tenants who don't have slumlords for landlords won't go to the trouble of searching for a cheaper place because of the costs associated with moving. Your first-year discount got the best tenant in the door, and providing quality housing will keep them there.
In conclusion, don't let your greed cloud your judgment when you're trying to find the right tenant.
© 2005 Terence P Ward, all rights reserved. Terence P Ward is the President of Landlord for Hirehttp://www.landlordforhire.com, a residential property management service of Green and Clean Corporationhttp://www.Green-n-Clean.biz, based in the Mid-Hudson Valley of New York State. You may find contact information for him on either of his company's web pages.
article_text... Read More
article_text... Read More
article_text... Read More
article_text... Read More
article_text... Read More
article_text... Read More
article_text... Read More
Every year, thousands of business owners and financial managers are faced with the task of obtaining attractive financing for equipment their firms want to acquire... Read More
According to the Equipment Leasing Association ("ELA"), U... Read More
In 2003, venture capitalists and investors dispensed over $18 billion to promising young U... Read More
Mike Caringi, owner of a small New Jersey business that sells pumps, found himself facing a gut-wrenching dilemma last summer... Read More
In her third Harry Potter novel, ?The Prisoner of Azkaban?, J... Read More
According to Pricewaterhouse Coopers, investment by institutional venture capitalists in startups grew from less than $3... Read More
Craig Berman beamed noticeably after completing his board presentation... Read More