Is Lowering the Rent the Right Choice? Insights from Kitsap County Property Management!

The Joseph Group Jul 2021

Ian Joseph

“Clients first!” – is a huge part of the DNA that Ian Joseph and his Team have established at The Joseph Group. This motto helps them focus on striving for the highest level of customer experience, for their clients (landlords) and customers (tenants). In fact, Ian strongly believes that in life, family and business, you must strive to give more than you receive. “You can have everything in life you want if you help enough other people get what they want." - Zig Ziglar

As a property owner, there are many things you must consider to keep your properties maintained and occupied. One of the most important considerations is the right price to charge for rent. 

As rent rates continue to rise, tenants may begin to feel the crunch. When residents find it hard to make ends meet, they might look for a new rental property with a lower monthly rent. How can investors know if they're charging too much for rentand if it's time to lower it? Our Kitsap County property management team shares some insights below.

Doubtful Woman holding Question Mark

How to Know If the Rent is Too High

Lowering the rent can also reduce your returns. Still, rental owners must find the balance of charging enough rent to cover expenses and experience good returns vs. lowering the rent too much that a rental loses money. 

Having tenants paying the rent every month is critical to success when investing in buy-and-hold real estate. Keeping good residents at ideal prices requires the right insights. Knowing what to look for can be an excellent warning sign that you've increased the rent too much—and it's about to hurt your income. 

Frequent or Lengthy Vacancies

If you struggle to find renters for your property, one of the most telling signs is the price. Prospective tenants often look for price first when searching for their next home. If properties are out of their price range, they move on to the next one that's more affordable while offering the amenities they want. 

Making sure your rent rate is affordable is crucial to avoid vacancies. While we're not suggesting a significant price drop after a few weeks with an empty property, take a look at the advertised rental price and consider a slight adjustment to lower it if your listing isn't generating any applications. 

High vacancy rates in the area could also force you to lower your rent to attract renters. When an area has a high occupancy rate, investors can raise the rent to stay competitive in an in-demand market. However, when Kitsap County rentals experience high vacancies, lowering the rent can help your property stand out from others in the market and shorten vacancy cycles

High Tenant Turnover

If you're struggling to keep quality tenants for more than one lease term, the monthly rent amount could be too high. High tenant turnover is a sign that it's time to review your rental rate and consider lowering it to encourage your renters to renew their lease. 

Most renters expect a rate increase at renewal. They might already be looking for a new home to move into when their lease with you expires. Slightly reducing the rent can keep them from leaving your property without disrupting your cash flow b a significant amount. Your property will continue to generate revenue rather than experiencing a vacancy, but make sure you adjust your budgets and income projections based on a lower rent amount. 

Your Rent Is the Highest in the Neighborhood

Is yours the only empty rental on the street? If the monthly rent for your property is higher than the other rentals in the neighborhood, renters will keep passing yours by. 

As a landlord, it is imperative to constantly research the area and take note of the rent rate in the property's neighborhood to ensure your price is not too high. Look at local listings online and inquire about the average rent people pay or in your area. Apartment listings are readily available online, and you can quickly know the fair rent for your property. Lowering the rent to make it comparable to others in the area can help attract potential tenants faster!

Talk with a property manager in Kitsap County to learn more about current market conditions and the factors to consider when setting the rental rate or adjusting it to eliminate a vacancy. 

Woman hands protecting a house

How Rental Analysis Helps

Rent analysis helps investors determine how much we should charge for our multi-family or single-family rentals. Conducting a thorough analysis includes comparing the size, number of rooms, and amenities in your property to other similar rentals in the area. Reviewing comps, analyzing area vacancy rates, and reviewing competitive rates gives property owners insight into how their rental rates stack up to the competition—and if they're losing tenants because the rent is too high. 

A Kitsap County property management company helps investors find the information they need for thorough rental market analysis. They also help rental owners make smart choices about setting the ideal rental rate or adjusting it as necessary. The right property managers will never encourage you to significantly (or arbitrarily) lower the rent and potentially lose significant income just to find a tenant for your rental!

Kitsap County Property Management Helps Rental Property Owners Analyze the Rent!

Property managers excel at setting the right rental rates for property management in Kitsap County. If you're not sure your rental has the ideal rent amount, let's talk! Joseph Property Management understands the importance of setting a monthly rent amount that attracts quality tenants while maximizing returns. We apply our expert property management services and insights to help you find the best rates for your properties and experience quality tenants who pay the rent on time!

Reach to get started with a Free Rental Analysis!

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