How long should you advertise for rent before lowering the price?

[DonG]

How may open-for-inspections should you hold before determining your price is too high?

Previously I've never had more than two inspections before finding a tenant. However I've recently settled on a house in an inner-city suburb and had three open-for-inspections. The interest has been mild and I've only had one application sent in by someone who seems to be biding their time deciding whether or not to sign the lease. Is it time to drop the asking price? Or is this common with higher-end rental properties?

 

[Jody in Darwin]

Hi DonG,

Not sure how high end your property is but they can definitely take longer to lease.

I usually begin advertising a property before it's vacant if possible - 2-3 weeks seems to be a good amount of time and I'd would consider dropping the price 1-2 weeks into advertising depending on the landlord's position and the feedback from showings.

It may be better to advertise for viewing 'by appointment' rather than a showing time. You can still set a showing time but you will need names & phone numbers of enquirers with the appointment method and you will be able to call them a day or two after the showing for feedback if necessary.

Make sure to you chat to people who come to your showings to find out what their situation is, what motivated them to come to your showing (there must have been something that appealed to them in your ad - find out what that is), and how your property compares to others they have seen (and the prices on them). Don't get upset if people tell you what you don't want to hear - the feedback is valuable information and they don't have to tell you if they don't want to.

This should give you a clear idea of whether the price is too high or not and by how much but it may also highlight problems you hadn't noticed, problems that can be remedied without reducing the rent.

Good luck,
Jody

 

[Melbournian]

How may open-for-inspections should you hold before determining your price is too high?

Previously I've never had more than two inspections before finding a tenant. However I've recently settled on a house in an inner-city suburb and had three open-for-inspections. The interest has been mild and I've only had one application sent in by someone who seems to be biding their time deciding whether or not to sign the lease. Is it time to drop the asking price? Or is this common with higher-end rental properties?

whereabouts is your property?

 

[santaslayer]

What's "recently" mean? Was this over the holiday period?

 

[DonG]

Melbournian: Prahran

Santaslayer: from the beginning of the year until now. I've been told it's a time when a lot of people are looking to move

 

[Goofy]

i manage properties in South Yarra/Prahran area, listed a $1000pw property 2 days ago, tenants coming in tomorrow to sign the lease.

Not sure how high end your property is, but high end properties always lease really well and quickly during Jan/Feb. You should also take into consideration that the interest level is always lower at the top end, and private inspections work better for this type of property rather than OFI's.

take a look on the internet.. is your property over priced in the market, if it is is then drop the rent now. I will generally test my properties with a higher than market rent for a week as in this market you just never know, but if i dont have anything solid or the level of interest isnt where it needs to be then i drop it straight away

 

[The Y-man]

How may open-for-inspections should you hold before determining your price is too high?

Previously I've never had more than two inspections before finding a tenant. However I've recently settled on a house in an inner-city suburb and had three open-for-inspections. The interest has been mild and I've only had one application sent in by someone who seems to be biding their time deciding whether or not to sign the lease. Is it time to drop the asking price? Or is this common with higher-end rental properties?

My Parkville apartment which has never been vacanct for any serious length of time since 2001 was vacant for close to 10 weeks. Seems to have really cooled off. Initially asked slightly above old rent, but then not interest for 2 weeks, dropped back to original rent, then had to skim below before we could get anyone interested.

Checked the insides in case agent hadn't made sure it was cleaned etc - place looked fine....

In the end got a tenant without a full time job, but with a parent as guarantor....



The Y-man

 

[ozsupra]

Not a simple answer,
I guess it really depends on how long you can hold out. You need to balance bringing down the rent for the good of the entire lease against missing out on market value. Often little incentives help; free Foxtel, 1 weeks rent free, pamper treatments, etc I know it sounds funny however these are relatively inexpensive and don't affect the "books" as far as the banks are concerned and really do attract tenants.
I recently had a property vacant for 3 months, (Brisbane) and was at my whits end. Of course as soon as I rented it (Free Foxtel) I had six more enquires. Those are the ups and downs of owning an IP.
A.