Have you recently found yourself with a York, PA rental property? Worse yet, are you unsure about how to determine the rental price of this newfound piece of property?
Getting in to the rental property business can be a very lucrative venture.
Yet, if you lease your property for too much, you risk having extended vacancies. And if you lease your property for too little, you run the risk of losing money.
Adding to that, there’s more to determining the rent rate of your rental property than just turning a profit. You need to know how to market your vacant property, find high-quality tenants, and understand the current market.
And all this can be tough if you’re a new landlord wondering how to determine the rental price in York.
Luckily, we have some effective ways for finding the perfect rent rate that will not only generate you money, but encourage your tenants to stay.
How to Determine Rental Prices in York
1. Do a Simple Calculation
One of the easiest ways to determine rent prices in York is to perform a simple math calculation.
All you have to do is find out what 1.1% of your rental property’s purchase price is. And there you have it, your estimated rent rate.
For example, if your property was purchased for $100,000, 1.1% of it would be $1,100.
Of course, this value is not set in stone. In fact, if your rental was expensive, you may consider dropping the percentage down to 0.8% instead. This ensures you don’t price your property too high.
Remember, if your property’s rent is too high, and tenants in the area can’t afford it, you’ll end up with a property that sits vacant.
The point is to find a balance between generating a profit and making your property affordable enough to keep tenants long-term.
If you want to take things a step further, calculate how much it will cost to manage the property each month. This way you can make sure your rent rate covers the expenses you incur as a landlord.
Think about expenses such as:
- Monthly mortgage
- Maintenance, repair, and emergency costs
- HOA fees
- Insurance costs
- Property taxes
- And anything else you’ll cover such as utilities or premium services
When you’ve done the math, make sure that the rent collected each month at least covers these expenses. If you don’t, you’ll never make money and you’ll find yourself in financial trouble.
Not sure what a good profit margin is?
Aim to generate a 6-8% profit from the monthly rent each month to make sure you’re benefiting from having a rental property.
2. Know the Current Market
Your property’s rental price will depend on the local market conditions and your competition.
So, before your set a final rental price, look at the following:
- What similar properties to yours are going for in the area
- The vacancy rates of nearby rentals
- What amenities are being offered to tenants in other rentals
- What local realtors and landlords feel is a reasonable rent rate
- Useful tools such as this calculator from Zillow to find out going rent rates in your area
Better yet, use the knowledge and experience of a York property management company that offers a Free Rental Analysis. This way, you’ll know for sure that what you want to ask in rent from your tenants is fair and high enough to turn a profit.
Knowing all this before you determine the rent rate in York will give you a nice foundation to work with. From there, you’ll be able to see what your property offers that sets you apart from the competition.
Then, paired with effective marketing of your vacant property, you’ll be able to command a more than generous rent rate for everyone involved.
3. Evaluate Your Property’s Amenities
Despite what the current market is doing, the amenities you have in your rental property will play a role in the rent rate.
The more desirable your property is, the more high-quality tenants you’ll attract that are willing to pay premium rent rates.
You can evaluate your rental property and make it a success based on things like:
- The view from your property, especially if your rental is part of a multi-unit building
- Square footage and layout, because people love open living spaces
- Upgrades such as appliances, flooring, landscaping, and more
- Storage space such as a garage, extra closets, built-in organizers, and backyard storage units
- Whether you offer extra services such as landscaping or pool maintenance
- If you cover utilities such as the cable or internet in the monthly rent
You should also take into consideration things like the location of your rental, dining and shopping in the area, and nearby schools.
4. Use Interest to Gauge Your Rate
Once your property goes on the market as available, you can use the interest generated from your property ads to determine the rent price in York.
If tons of people call asking to see your property, chances are you’ve low-balled the rent rate and people know it. If no one calls asking to see the property, or interest is very low, you might have high-balled the rent rate.
In addition, if you find that there is a lot of interest in your property, but very few decide to put in applications, there may be an issue. For instance, the rent rate may be reasonable for the area, but the condition of your rental might not be worth the price.
If that happens, you know it’s time to make some upgrades to make your property more appealing. And who knows, after you perform renovations, you might even be able to ask for more in rent.
5. Get Help from a Property Management Company
As an accidental landlord, you might find the whole idea of managing a rental property overwhelming.
If you do, don’t worry. Even experienced landlords find handling every aspect of their rental property business too much at times.
A reliable and experienced York property management company can help you determine rental prices in York.
Not to mention, it’s their job to help you:
- Market your property aggressively across many channels so the right tenants contact you
- Create appealing advertisements that include high resolution images, lots of description, and compelling copy
- Screen all potential tenants thoroughly so that only the highest quality ones are consider for placement in your property
And that’s just the beginning.
After your property manager helps you determine a rent rate for your York property, and places a tenant, they can help with everything else too.
For example, a good property manager will help you collect rent, perform inspections, and handle all maintenance requests 24/7.
If you’re in need of York property management to not only help you determine rental prices in York, but also manage the day-to-day operations of your rental, contact York H-G Properties today.
We understand the current market in York, PA and can help you decide how much rent to charge your next tenants.
Plus, we strive to generate you the highest ROI possible, maintain tenant satisfaction, and keep you informed about your property’s financials, so you maximize your profits and collect a positive cash flow every month.