As Las Vegas home prices continue their slide, the rental market has seen an uptick in available rentals and as a result, more stagnation in the market. Nonetheless, properties are still leasing above average. When market conditions change, what should Landlord’s know and do to stay ahead of market changes and curves?
Don’t expect last month’s rent
If you are trying to lease out a property in a saturated or otherwise more competitive market, you will have to adjust to today’s market. That may require you to make a reduction in your asking price or offer an incentive to a prospective tenant. While other comparable properties from a few weeks ago may show strong numbers, the market can change, as it has, and require adjustment.
It is better to adjust sooner than later. Otherwise, trying to attain a rent that is now overpriced will lead to an extended vacancy and lost money. Additionally, every day that the house sits empty it is costing you utilities and opens your house to vandals and squatters.
Look at the big picture
A temporary reduction in rent is not a need for concern. Remember, both the real estate and rental market are cyclical, meaning, they go up and go down. Even if you find yourself leasing out a property during a downturn, eventually it will go up again, allowing you to raise the rent or re-lease the home for more. Nonetheless, rents today are higher than they’ve ever been before.
Focus on finding a great tenant
Whether the market goes up or down, in the end, a quality tenant will make or break your rental property. Thus, focus on a tenants qualifications. Find the best qualified tenant in today’s market. Even if someone is willing to pay over market rent but isn’t qualified or has poor credit or rental history, will the extra rent collected offset the potential risk?
Making sound decisions is key with your rental property. Far too many owners open themselves up to lost rent and tenancy issues because they approach things from a limited perspective. Look at the big picture and adjust as needed. Find the best quality tenant. In the long run, your rental property will succeed and you will avoid unnecessary issues.
Contributed by Nicklin Property Management. www.nicklinpm.com