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Updated almost 3 years ago on . Most recent reply

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Should I raise the rent after information received from agent

Robert Allen Lin
Posted

I just purchased a property in Spring Texas. The listing agent simultaneously put the property on the market for lease. In the span of 2.5 weeks, there were 19 showings. Of the people who visited the property 7 left feed back. Four out of seven rated the property 5/5 for desirability and pricing just right. One person rated 4/5 with pricing just right, and another 3/5 with pricing too high. The last person was "maybe" interested in leasing with no feedback. 

I believe 1 person submitted an application, at least 3 were very interested in leasing. The agent has passed on the information of the tenant interested, at the listed 2,200/mo rent price. My question is, should I try to raise the rent and try to get a higher rent based on what seems to be interest in the property? Based on sold comps in the past 6 months, 2,200 is around the upper end of rent, so I'd be thinking an additional 50 bucks per month, 100 max. Is it irresponsible investing to not list it ourselves and try to get the best offer or use it as negotiating leverage? How should I be thinking about it as a first turnkey rental?

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Bill B.#3 1031 Exchanges Contributor
  • Investor
  • Las Vegas, NV
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Bill B.#3 1031 Exchanges Contributor
  • Investor
  • Las Vegas, NV
Replied

19 showings in 2.5 weeks with only 1 application isn’t very many. Either you are already at the top of the pricing market, aren’t advertising well, or it’s a small/slow market. You should have 20 applications within a week. 

Think of it this way. If it takes 1 extra week to find a tenant paying $50 more you’ll lose out on $550 in rent that month to get $600 extra for the year. If it takes more than a week you lose money charging more rent. 

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