By the end of this post, you will know how much rent to charge. Even better, it’s all broken down into just two simple steps.
The Most Important Number
As a landlord, you don’t want to sell yourself short, but you also need to avoid a costly void period for your property. This balancing act makes getting the price right the hardest part of putting a property on the market. How can you get it right?
Here’s our two-step approach.
- Find the upper and lower limit of prices for properties with the same number of bedrooms as yours
- Using our list of price-factors, work out whether your property belongs at the top or bottom of that price range
STEP ONE: Find Your Price Range
The first thing you need to do is find the price range for properties like yours. To do this, simply look at properties on the market in your area that have the same number of bedrooms.
Now look at the cheapest and the most expensive properties. You should disregard any unusual outliers – e.g. listed buildings or notorious estates.
You’ll probably find a price range of around £400pcm (roughly £50 per week) with the majority of properties being in the middle third of the range.
The easiest way to do this is to use our online rental price app. We use all the data we collect as the largest UK letting agent (over 50,000 properties per year) to find out the price range for your property.
Just enter your postcode and number of bedrooms to instantly see the rental value range of your property.
STEP TWO: Find Your Place in the Range
Now that you know the range of property prices in your area, you need to find where your property sits within it. There are several factors you need assess to make sure you place your property at the right end of the price range.
1. Location: Region, Town and Positioning
The town, village or county your property is in may determine its price range, but the specific location within the town is crucial in finding the precise rental value. Being close to major transport links, good schools or university campuses can be a huge bonus for your rental price.
2. Square Footage
Obviously, the more floor space your property has, the more you can charge for it. But remember to contextualise size within your area. What counts as a lot of square feet in central London may count as very small in Northumberland.
Floor space can sometimes be as important as number of bedrooms, especially in cramped city centres. A huge two-bed in an area without many large apartments could fetch more than a smaller three-bed.
3. Special Features
Not all properties are created equal. Some have large gardens, lovely balconies or in-vogue features. If yours does, then you can place yourself higher within the price range for your area. Other special features include fireplaces, parking spaces, loft-space, under floor-heating, and more.
Remember though – if you decide to charge a little more due to these features, you need to make sure you include them in the description of your property! Otherwise, you will just seem overpriced and get fewer enquiries.
Furnished properties are usually more expensive than part- or unfurnished properties.Remember this when comparing prices. If you know that your furnishings are particularly desirable or expensive, you might consider charging more accordingly.
5. Beware Round Numbers!
Finally, think about how portal websites (e.g. Rightmove) work. Most tenants will search within a price range they can roughly afford. If you fall just above a popular price bracket, you should consider lowering your price so that you fall within it.
1800-2000pcm is a popular price range. If you value your property at 2020pcm, then you might consider dropping this down to 2000pcm, so that many more tenants will see your property when searching this popular price range.
In a year-long tenancy, you will lose £240, but if dropping the price helps you find a tenant even one week faster, you will have made this money up already by avoiding a void period.
Remember: tenants love to bump the price range up to a round number. Make sure you’re on the south side of round numbers where possible!
- Use our tool to find your price band
- Work out where you should sit within that price band. Assess:
- Square footage
- Special features
- Try and price the rent below ‘important’ round numbers to maximise exposure