One of the things that made Sherlock Holmes such a great detective was his vast knowledge of seemingly trivial information. You also have to have a grasp of all types of information, some definitely trivial, to be a good property manager.
For example, what specific properties will rent for in specific neighborhoods.
But I will admit tat many times an owner will call me about leasing their home for them, and I have to admit I’m really not sure what their home would lease for off the top of my head.
There are a number of factors that go into determining the rental price for your OKC rental property.
In this article I’m going to review those factors.
And, I’ll reveal my approach for pricing at the then end of the article.
It all starts with your neighborhood.
How popular is your OKC rental property neighborhood?
The popularity of your neighborhood is going to be a driving factor in establishing the going rental price for your OKC renal property.
It comes down to supply and demand.
The higher the demand, the higher the renal price.
Here are list of factors that drive up the rental price for an OKC rental property:
- High quality schools. Oklahoma City public schools has a bad reputation. People will live elsewhere so their kids can go to certain schools, like Edmond, Putnam City North, Bethany, etc.
- Proximity to desirable shopping, work locations, and amenities. This is a bit of a chicken and egg type of thing. For example, many luxury homes are built in Edmond. High end shops and restaurants are also located in and around Edmond to serve those residents. And, more residents move in because of the shopping and restaurants.
- The “status” of a neighborhood. Is it like a designer name brand? If you live in Gaillardia, a neighborhood in south Edmond, it says something about you. It says money and status.
- It’s a neighborhood where groups congregate. That is, their friends live there, so they want to live their also. For example, young people (20-30 year olds) love living near the Plaza district (NW 16th Street between Western Avenue and Pennsylvania Avenue) because that’s where their friends and their hang out are located.
There are others, but I think you get the idea.
I’ve written an article about how to select the right OKC rental property and neighborhood, which is here.
How homogeneous is the OKC rental property neighborhood?
The more differences there are in the homes in your neighborhood, the more varied the rental prices will be for OKC rental properties.
In older neighborhoods (homes built prior to 1950), the homes in the neighborhood are more varied than newer ones.
During the housing boom that began after World War 2, home builders began to build cookie cutter homes as quickly and inexpensively as they could. Housing additions sprang up in the suburbs of cities almost over night with one home very similar to the next.
The newer the housing addition, the more homogeneous the homes.
You do see more of a variety in homes that were built between 1950 and 1990.
In those neighborhoods, home of the homes have been updated, and some not so much.
In the newer neighborhoods, the rents are more homogeneous because the homes are so similar.
For the prospective renter, it’s easier to make apples to apples comparisons when are looking for homes or apartments to lease.
And in newer homes, the amenities tend to be more homogeneous also.
For all of these reasons, in the newer housing additions the going rents are more established. Your prospective renters are going to have a good feel for what constitutes a good deal, and what constitutes a home that is overpriced.
What about the Amenities?
In older neighborhoods, the updates are all over the place. Some homes were updated just a few years ago. Others have some updates in the 1970’s, some in the 1980’s, and others within the last 10 years. Amenities make a huge difference when it comes to determining what your OKC rental property will rent for.
Amenities do a make difference to prospective renters.
Here is a short list of amenities that increase the rents:
- Central heat and air.
- Ceiling fans.
- Dish washer.
- Microwave oven.
- Washer and dryer.
- Second or third bathroom.
- Garage and/or outbuildings.
- Security system.
- Community pool and/or clubhouse.
What similar properties are for lease in the neighborhood?
When most people or property management companies are going to list their properties for rent, they will list them on these sites.
It’s generally not great news when you see more than a few houses for rent in your neighborhood. That is simply more competition that you need to contend with.
Be sure that you compare your OKC rental property to other similar properties.
If you have a 3 bed 2 bath 2 car garage with 1,500 square feet built 10-years ago, look for homes that are close to that description. How far away should you consider a comparable? I would try to stay within a few miles of your home if at all possible. Remember that the further you go from your house the more that will be different (schools, shopping, etc.).
Look at the photos of these OKC rental properties. Do they have similar updates to yours?
How many days has a given property has been listed for rent? The rental price at which a comparable OKC rental property is listed for rent may be too high if it’s been listed for rent more than 30 days. The ones that are priced appropriately are not going to be on those sites long because they will get snatched up.
Also, keep in mind what you are looking at is not what properties are leasing for, but what the owners of the OKC rental property would like to get. So the amounts you are looking at on these websites are going to always be a bit on the high side.
Section 8 rentals are a little different because the housing agencies have guidelines on what they can pay for certain properties. If you are looking to get a feel for those Section 8 rental prices, you can go to https://www.gosection8.com.
My philosophy for pricing rentals.
The way that we establish the initial rental price for OKC rental property is to consider all the information above.
And, we do have an extensive library of rental prices for other OKC rental property that we draw upon.
We like to start with a rental price is that is on the high side, but not so high that people aren’t going to consider it.
We list the OKC rental property for that price.
Then, our system tracks the response to that advertising. We track the number of leads (people interested in the property), and those that are qualified. Our system also tracks the number of scheduled showing. It tracks the number of actual showings. We know the numbers to expect for a properly priced OKC rental property. We can tell if something is off.
I personally check these statistics once every week. That way, I can adjust pricing.
If something is off with the response we are getting, we will back off the rental price.
Marketing makes a difference.
Your rental property marketing determines how many people will be interested in seeing it.
I’m not going to go into what makes an advertisement perfect in this article.
But prospective renters just aren’t going to be interested in your rental property if you are missing a critical item like good photographs.
Would you like a free assessment of what the rent should be for your property? Either give us a call, or fill in the contact form below.