Every landlord wants to rent out his unit at a good rate and spend minimally on furnishing and touching up the unit. However, I would urge all landlords not to be "penny wise, pounds foolish"!
Currently, the rental market is sluggish due to a large supply of rental units and the fall in the number of tenants. Hence, it makes it even more important to stand out from the rest of the rental units. After all, leaving the unit vacant could mean losing some rental income.
So the question now is: how can you quickly rent out your unit and not compromise on the bottom line?
Here are three useful tips to answer that question.
a) Price it right! As much as every landlord wants the highest possible rent, it’s best to price it to an attractive level to attract more viewers first. If you rent your unit at $3,000 per month when the average price is between $2,000 and $2,300 per month, you might lose out on a lot of potential renters.
You can price it slightly higher than the average rental prices if your unit has a unique selling point. For example, having a superb view, very well furnished and/or renovated unit in an old estate/condominium, etc.
Overpricing your unit would mean potentially leaving your unit vacant. As a result, most owners will eventually lower their rent expectations.
Assuming the market rent is $2,000 per month, and there’s a tenant who wants to rent at $1,900 per month. If the tenant has minimal requirements, it would make sense to accept the offer. Rejecting the tenant could potentially leave the unit vacant for at least 1 or 2 months (every month of rental income loss would be $1,900/12 months: $158 per month). You could be worse off if you leave the unit vacant for more than one month!
b) First impression counts! Nobody likes to go through the hassle of touching up the unit even before finding a tenant. But if the unit doesn't look pleasant, the advertisement would not look attractive enough to lure in enquiries. In addition, tenants who viewed may also be turned off by how the property looks.
Simple and easy ways to spruce up the unit include painting the entire unit in white, removing any unnecessary clutter, and throwing away old furniture and appliances.
c) Be flexible with furnishing requests! Do your math! Nowadays, furniture and appliances can be very affordable. For example, a brand new 40-inch television can cost less than $500. A proper dining table set? Less than $400.
Let's say there’s a tenant who wants to rent the unit at $2,000 per month for a one year lease and requests for a dining table set and a television. Rather than rejecting him, perhaps you can negotiate for slightly higher rent at $2,050 per month? An extra $50 a month would mean earning another $600 for the entire year. Don’t forget that, at the end of the lease, the TV and dining set will still belong to you!
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