Whether you are just venturing into real estate investing or have owned multiple rental properties for years, pricing your rental correctly in a hot and constantly changing market can be a challenge. Charge too little and you’re leaving money on the table that could be used for maintenance, renovations and upgrades. Charge too much and your property could sit empty for months robbing you of income.
While there are many things to consider when pricing a house for rental, here are five main factors that can have the greatest effect on pricing: location, size, updates, amenities and comparables in the area. Let’s review each of these to see how they affect the price of your rental.
Location
This one is obvious and it’s especially applicable in Central Oregon and Bend in particular. For instance, the difference in price between similar properties on the east and west side of Bend can vary dramatically. If you’re new or unfamiliar with the area, Bend is roughly divided in half by Hwy 97. For various reasons (walkability, towering Ponderosa pines, less traffic), properties on the westside of Bend carry a premium and will typically rent for more than similar properties on the east side of town.
Rental properties on Bend’s east side will generally have more square footage and smaller yards than on the east side; however, you will be closer to Mt. Bachelor and other attractions on the west side.
Size
For the past few years there has been a surge in new home construction in Bend, especially on the east side of town. Many of these homes have similar floor plans and are generally 3/4BR, 2/3BA and about 1,600 sq ft to 2,200 sq ft. Most have two car garages and relatively small yards around 700 sq ft. Families with kids and pets will be often be attracted to homes in this size range.
While there is some new construction on the west side, most renters will be expecting to rent slightly smaller, older homes or pay a premium for the newer, larger homes.
Updates
According the the National Association of Realtors, upgraded kitchens and bathrooms are among the more important upgrades renters look for in home. Not only do newer refrigerators and dishwashers attract more renters, they are more energy-efficient and less costly to operate.
Hardwood or engineered flooring is more attractive to those who suffer from allergies, it lasts longer and is easier to clean than carpet and can be refinished instead of being replaced.
Amenities
Some amenities that can affect rental rates are within a homeowner/landlords ability to change; others, not so much. For example, views and walkability factors are mostly beyond the landlords control. But things like stainless appliances, washer/dryer, allowing pets and even landscaping. Buildium, a property management software, says the benefits of having an outdoor landscaped space can provide a short ROI and fetch top rental rates by attracting more qualified rental applicants.
Comparables
We all know what comps are and they can be the single most important factor when determining your rental rates. With so many online tools at their fingertips, renters can quickly determine the rental rate ranges in a particular area. Renters will also often not consider the outliers; those properties much higher or lower than the average.
Elevation Property Management can help your property stand out from similar rentals to ensure it rents quickly, attracts the most qualified applicants and earns you the best rental rate possible. Contact us today to get a free rental analysis on your property.