Atlanta was recently ranked as the second hottest rental market in the country.
There are few better places in the country to make a property investment than in Atlanta. Whether you're a seasoned real estate investor or a first-time landlord, researching the local real estate market is one of the most important things you can do when you get a new property.
To maximize your rental income, you need to nail property pricing. In today's post, we'll explain some of the benefits of conducting a rental analysis on your investment property. Keep reading and you'll see how crunching a few numbers can make all the difference for your rental income.
Find Great Tenants
The end goal of a rental analysis is to come up with a monthly rental price that suits your home and the market. One of the biggest benefits of taking the time to do this is that you'll find great tenants for your units.
If you price your unit strictly to make money, you'll likely scare off tenants. All tenants have a budget and they're not likely to go outside of it when a landlord is arbitrarily driving up the rental cost. Performing a thorough rental valuation will tell you exactly how much to charge to appeal to Atlanta's renters.
When you have a fairly priced rental unit, good tenants are more likely to stick around. Tenant retention is a huge deal for landlords because it prevents you from having vacancies. Fewer vacancies will maintain the overall profitability of your rental property.
Cover Your Expenses
A rental analysis will simultaneously make sure that you're charging enough to cover your expenses.
There are a few schools of thought about rental property pricing. One is to charge 1-2% of your property's value. The median listing price in Atlanta is around $395,000, so 1% would be a rental charge of $3,950 per month.
This is a huge monthly expense for most renters, so to widen your tenant pool, you could turn a single-family home into multiple rental units. Charge a lower rent price to multiple tenants to get you up to $3,950 per month, which should cover your mortgage and other expenses.
When you do your due diligence on your rental valuation, you give yourself negotiation leverage with tenants. There's always a negotiation stage when you get a new tenant or renew a tenant's lease.
They may try to get a lower rent price, but if you've done a rental valuation that shows you're charging the right amount, you can leave the ball in their court. If they know you're charging a fair price, you've got all the leverage in these negotiations.
Always Perform a Rental Analysis
Now that you know why you should always perform a rental analysis on your Atlanta real estate, it's time to tell you how to do it. Hiring a property manager with plenty of local experience will give you the most accurate analysis possible.
PMI Marietta is one of Atlanta's top property managers, offering comprehensive services to the city's real estate investors. Contact us today to get your free rental analysis.