Doing regular market assessments are a key part of owning a profitable investment property in Schaumburg. These assessments can greatly aid property owners in identifying the market rental rate for their single-family rental homes. There are plenty of ways to calculate rental rates, but they all need to be based on the rental market. If your rate isn’t based on that, then you run the risk of setting a rate that is too high, making it difficult to rent the property. On another note, if you set a rate that is too low, you’ll also be risking your rental income. But that’s not even the worst thing that could happen. You could also be driving away potential tenants because the super low rate would communicate to them that something is wrong with the property. It’s essential that you know what the going rental rate is for properties in your local market. This will make certain that your rental rates will be within the range that renters in your area are willing to pay.
Conducting a rental market assessment entails gathering information on average rents for rental properties in a particular area. To start, first, identify at least three rental properties that are comparable to yours. Figure out what the monthly rent is for each one, and then divide that number by the square footage. Averaging the price per square foot will then indicate what the average rent is for a property like yours. You can then use this data to figure out the most accurate rental rate for your property.
There are other considerations that have to be looked at when doing a rental market assessment. These considerations include the attractiveness of the neighborhood, proximity to amenities, and access to major roads and public transit. When assessing the local rental market, there may be elements that would justify a higher rental rate. A neighborhood with smooth roads, nice sidewalks, and pristine properties will have greater appeal and will attract quality renters. Nearby amenities like libraries, shopping, and parks can also be a good attraction, so would quick and easy access to major roads and public transportation. All of these aspects need to be looked into when doing a rental market assessment, so you could come up with the appropriate rental rate adjustments.
Several investors understand that rental market assessments are a significant part of locating and acquiring quality rental properties. Hence, market assessments shall likewise be conducted annually to make sure that your rental properties are keeping abreast with the changes in the local rental market. Regular rental increases can ensure that a rental property continues to be profitable over the long term and remains competitively priced no matter what the local market is doing.
However, one problem is that rental market assessments can take up a great deal of time, and if the inappropriate comparable properties are used, it could result in a significant loss of rental income from extended vacancies or a rental rate that is too low. For this reason, including industry experts on your investment team is so important.
At Real Property Management Northwest Chicago Suburbs, we give free annual rental market assessments to each one of our property owners currently under contract, along with one free rental market assessment to property owners considering our services. By performing a fresh market assessment on each property every year, one anchored to market understanding and accurate facts, we help investors make their rental properties competitively and accurately priced.
Would you like to make full use of a free rental property assessment? Contact us to learn more.