I get it. You want to make as much money as you possibly can on your rental units — who doesn’t? I own rental property, and I certainly do! That said, are you familiar with the phrase, “To cut your nose off to spite your face?” In my thirty years experience, I have come across many owners, “walking around without noses.” It’s sad.
I do my best — I really do! I show them the market data and statistics for their area. I show them the average times on market and how mispricing their rental will drastically increase their time on market. I explain to them how, “time is money,” when it comes to a vacant property.
In spite of all of my sincere, best efforts, there are times that for one reason or another — sometimes out of greed, sometimes out of need, and sometimes out of ignorance — landlords simply cannot embrace the reality of what the market is (and is not) willing to rent their property for. In the war of your nose against your face — you always come out a loser.
True Story . . .
I once met with a residential rental property owner who with great seriousness explained to me that the reason why her property was worth $450.00 more per month than all of the exact same homes (6 of them) that had rented in the exact same sub-division, within the past year, was the fact that she had:
- Installed “heavy duty screens” (this was a huge selling point in her mind).
- Put in all L.E.D. light-bulbs.
- Replaced the dishwasher.
- Just resurfaced the driveway.
I politely and professionally explained to her that it was great that she was maintaining her property and that it would certainly help during the leasing process. I let her know that the expectation of all tenants, for all properties, was that there would be a working dishwasher, serviceable screens, and a properly maintained driveway. I also explained to her that in this day and age, what with the internet and instant availability of all sorts of information, that tenants already have a very good idea of what Sarasota properties should be renting for in any particular area. That trying to stray too far from the norm would put her at a significant disadvantage as compared to other comparable rentals on the market at that time.
She was a very nice woman. She served me coffee and cookies. Alas, in the end, I could not help her to understand that when it comes to setting a rental rate, it does not matter what I as a property manager want or think, or even what she as a landlord wants or thinks. All that matters is what the rental market wants and thinks, and at that particular place and time, for that particular property, with those particular amenities, the market wanted to pay $1,800.00 per month, not $2,250.00. Sadly, I had to walk away and not take on the management of her property. I didn’t want to do it, but it was the right thing to do. Had I agreed to facilitate her grandiose price expectations, in the end, she would have only become angry and disappointed – with me! I could not bring myself to do that to her, or allow her to do that to me.
And The Moral Of The Story Is . . .
Renting houses, condominium units, duplex units, etc., is a business. It is controlled by all of the same supply and demand principals that govern all markets and businesses. At a given time, under given market conditions, a property may rent for, say $1,500.00 per month, but at another time, under different market conditions, the exact same property can rent for dramatically more ($1,750.00) or dramatically less ($1,250.00).
You need to know your Bradenton market and its prices intimately. NOT what things rented for 18 months, or a year ago, but what things are renting for TODAY. Flow with the market, and you will rent quickly and for the highest possible amount. Fight the market, and you are in for a long and disappointing slog.
Your Next Step . . .
If you are interested in a no-obligation market analysis of your rental property we are happy to make that happen for you. Real Property Management of Sarasota & Manatee leases and manages residential houses, condos, and small to mid-sized multi-unit properties on behalf of their owners. We handle tenant screening, inspections, maintenance, and rent collection. Our owner clients, who come from across the United States and from around the world, own rental units in the following communities: Sarasota, Bradenton, Lakewood Ranch, Ellenton, Parrish, Palmetto, Osprey, Nokomis, Venice, North Port, Englewood, and Port Charlotte, FL. You can contact us here, or call us at 941-216-0005.
Download our free guide to finding the best Sarasota and surrounding area property manager for a helpful checklist you can use when interviewing property management companies.
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