If you are the owner of a single-family rental property, you already understand how important it is to keep ahead of the curve in today’s marketplace. One of the greatest methods to accomplish this is to conduct a rental market analysis on a regular basis. A rental market analysis is useful whether you are looking for a new property to buy or managing one you already own.
A good market analysis will give you an idea of what your competition is doing and will assist you in determining an accurate rental rate for each property. In the following paragraphs, we will lead you through the steps of conducting an accurate rental market analysis.
Research the Neighborhood
The first step is to gather data. You ought to factor in things like average rental prices in the region as well as vacancy rates. This can be accomplished by looking online or contacting a local real estate agent. Once you have this knowledge, you can comprehend what your competitors are doing.
It is also critical to thoroughly evaluate the neighborhood in which your property is located, considering surrounding attractions, the overall walkability of the region, the quality of schools, availability to shops, and so on. Take note of how tidy the streets are, as well as how many homes appear run down or vacant. All of these information will influence how desirable an area is and, as a result, your rental rate.
Identify Comparable Properties
Next, you will want to find several comparable properties close to your own. Examine the square footage, number of bedrooms and bathrooms, and any particular features or services that each property provides. Also, pay particular attention to the property’s condition because one that is well-kept will rent for more than one that is in disrepair. This can be determined by walking through each property or looking at images, if available.
Rental rate factors include age, wear and tear, and overall condition. To get the most realistic picture of the rental market in the area, look for properties that are as close to yours as possible. Finally, research and obtain a current rental rate for each property. You can find this information by searching online, speaking with the tenant, or calling the existing property manager or owner.
Calculate the Average Rent per Square Foot
To determine the value of your property in the current market, obtaining the necessary information is critical. Calculating the average rent per square foot, which involves a more extensive research, is an important part of this procedure.
To get the most accurate results, add the total square footage of all comparable properties and divide it by the total number of units. This estimate will provide you with an average price per square foot for the area. It is critical to ensure that comparable properties have similar features to your property in terms of location, age, size, and amenities.
After determining the average rent per square foot, multiply that figure by the total square footage of your property to calculate the appropriate rent you can charge. Remember that the final number may differ based on the individual features and location of your property.
Adjust Your Rate as Needed
Nevertheless, you may need to change your rental rate based on a few other criteria. For example, if your property is in better condition than the others, you might charge a premium. Alternatively, if it’s in a more desirable location or has unique features or facilities, you may be able to negotiate a higher rent.
You should also evaluate the present state of the economy and whether the rental rate you may charge right now would still be competitive in the market soon. Set your rental rate using the data you’ve obtained and your best judgment.
Remember that the rental market is continuously changing, therefore you should conduct a market analysis at least once a year. This will help you remain ahead of the competition and keep your property occupied.
Real Property Management Sailfish Coast has your back. We have proprietary industry data and the experience required to provide the most accurate rental market analysis in Port St. Lucie and the surrounding locations. Contact us online or by phone at 772-242-9094 to learn more or to receive a market analysis for your property!
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.
