If you have a rental property you have much to worry about. From having great tenants, to the price they pay each month. Especially in today’s market, you want to make sure you get top dollar for your piece of property without going too high to scare your tenants away. Charging the right price had been as simple as making up a number sticking to it. If you want to make sure all your bills are covered so you’re not upside down would be a great success. However, not every piece of property will have the luxury of breaking early. Overall the most important piece is that you have a tenant in your property paying your mortgage for you.
Your renters charge at times won’t be exactly what you desired for, but it will all depend in the market that you’re in. So you are asking yourself, how I justify how much you can charge for your piece of property. Well one way is to go to a local adverting website and see what other houses in the area are renting for. Usually all the prices are within a couple hundred dollars of each other. You always want to make sure you are getting the most for your place. You can set it really high and if you get no bidders, you can always drop the price back to what renters think is reasonable. It’s a tough market, owners want to get top dollar and renters want to get cheap dollars. It brings the two in the middle to be able to agree on a price which both parties think is fair.
Ideally, the amount you charge should cover all of your costs. You want to make sure you are not throwing money into your investment property monthly. You goal should be to have the rent cover the mortgage, the insurance the taxes and possible the HOA if there is one. You also want to make sure you have a cheap handy man that can fix your property for a decent price.
Another issue that would come across is that you might not have a tenant in your place for a couple months. If you can get some extra money on top of the renter payments you would be in good shape. Instead of eating the cost when you have no tenant, you should have money saved up from the prior months/year that you can put towards your mortgage.
With extra income coming in with your mortgages, this will allow you to upgrade your investment property which will allow you to get the highest dollar amount. With the extra money you will be able to upgrade, carpet, counter tops, paint, landscape, etc. This will bring your value of the house to its top dollar. The size of the place might be the same as your neighbor, but it can be night and day when they actually walk inside which will help the value of your price to your renters.
When setting the price for your property you must take into consideration every necessity that is needed. You must make sure you cover all your costs so you are not stuck with monthly payments. Remember, this is an investment not a liability. Choosing your price point will be the most important step when finding a renter. Do your homework and you should be ok.