Chesapeake VA Is my rent ask too high??

Question

Looking for some feedback on rent amount. I have a property in Chesapeake VA that I am marketing as a MTR; however, it has been on the market for over a month now with no real bites. I have tried lots of things to help; posting on additional sites, opting to allow pets when I didn't initially, lowering the rent by $200; lowering the cleaning fee, etc.

Opinions welcomed and I know this is dependent on a lot of factors.

It's a 2BR 2.5BA townhouse, lakefront, convenient central location, safe neighborhood, completely and newly furnished, TV's, W/D, fully stocked kitchen, king size bed, deck and balcony overlooking lake, professional photos, video walkthrough.

Utilities all included along with furnishings.

MTR, so month to month leasing option.

I initially listed it for $3000/month, then lowered it to $2800 a few weeks ago.

Is it too high still do you think? That's why it's not renting?

Or is this just a slow time of year?

Thanks for any insight.

Bonnie Low · Answer

If you go to the GSA website and search travel nursing contracts you can get an idea of the per diem for your area. This will give you some idea of what nurses/travel med professionals are being paid but bear in mind that they must have a permanent residence in order to qualify for the out of town per diems so they're usually supporting more than one residence on their pay. Generally speaking, if you're not getting any interest there's usually one of 3 reasons: hospitals in your area aren't using travelers as much or at all, you're asking too much, there's too much competition, or the price isn't appropriate for the finishings of the property. Allowing pets definitely helps. Having one bathroom per bedroom is a plus also. If you haven't already, get on some facebook pages for travel pros in your area. Share your listing. You'll find out right away what the issue is because people don't hold back with their "advice." Good luck to you!

Chris Allen · Answer

Not sure if the GSA of $2900-$3000 is including meals or not, but I can tell you as a travel nurse, we typically try and find a place to stay that is cheaper than the Tax-Free that we are receiving. I just pulled these numbers from an actual job posting for an ICU travel job in Chesapeake. Below is giving $2,743.96/mo in housing allowance ($3,113.34 allowance total). As a travel nurse, you are also having to pay any rent/mortage back at home, while typically also having to pay for your own insurance and what not. So if you are having to spend your entire allowance on additional housing, you are only working for $39/hr (which is like a staff job anywhere else). I would say your competetors at $1800-$2.1k are right on the money for what travel nurses would be looking for. What could you rent it for as a LTR?Taxable Pay Rate:$39.00/hr x 36hr $1,404.00 Non-Taxable Lodging Stipend:$19.06/hr x 36hr $685.99 Non Taxable M&IE Stipend:$10.26/hr x 36hr $369.38 Gross Weekly Compensation:$68.32/hr x 36hr $2,459.37 Estimated Take Home $2,192.61/wk

Chris Allen · Answer

So this changes according to what they are actually getting paid. My example was just what I personally would be looking for, not an actual rule of thumb. If they are actually getting $4,740/mo for housing, I would imagine they would likely be willing to pay upwards of $4k+/mo if comparable properties are renting at that. Breaking it down to a rule of thumb of 50-70% is a little more difficult to do. Also, just because the GSA says the per diem is $158/ day, does not mean that they are actually getting that. The closest job I could find that shows pay was in Alexandria. The housing allowance for that job was $2,940/ mo, while the GSA shows a rate of $3,255. If you are wanting to see what travel jobs in your area are paying nurses, I would recommend looking at travel nurse job boards and Facebook groups. The GSA can give you a general idea, but it does not show what they are actually getting paid.

Terrell Garren · Answer

If it were spring/summer, the market would be telling you the rent is too high. Winter is a slow time to rent. In spring/summer. I will get 50 inquires in 2 days for a new listing and sign an agreement within a week. In winter, I will get 10 inquires in a week and it might take a month to sign. I would advise patience.

Mel Volland · Answer

@Jacob Sloop thank you! @Heather Brown I'm happy to help! As a quick response, it's certainly slower in the season and contracts should pick back up in Jan. But I have been doing MTRs for four years here and this is the first time I've experienced a full month vacancy in a unit/property. MTR's are becoming more widespread and popular making the competition steep. I'd research what other MTR's are listing in your immediate area and base your pricing on that. $3,000 seems high for off season, but that's without fully understanding your location and property. Hope that helps! Feel free to reach out anytime!

Heather Brown · Answer

Thanks for the reply Chris. I looked at the comps and unfurnished ltr's go for 1800-2100/month, so with the utilities at ~ $500 and the entire place furnished, and the benefit of not being locked into a yearly lease, I came up with the $2800. Trying to hit that sweet spot between being competitive but still have some cash flow. Maybe I missed the mark though.

Patrick O'Shea · Answer

Who is your target demographic? Is there a large number of them in your area? How long has it been on the market? Where are you listing it? What's the long-term rental rate for the unit? My experience is it doesn't take more than a few weeks to get rented in a good market. Maybe you need to drop the price to get some reviews to obtain some level of trust. Do you have many restrictions (no pets, etc) which reduce your guest/tenant pool? All of these are questions to understand your situation better.

Chris Webb · Answer

Put yourself in the renter's shoes, how would you go about making an offer on your place? What comps in the area justify your rental price from a renter's perspective?

Heather Brown · Answer

@Chris Allen. This is great first hand perspective. Thanks for sharing this. Very helpful!

Heather Brown · Answer

@Mel Volland. Thanks for your input. It's helpful to hear the perspective of someone with all of your experience. It does make me feel a little better to hear that the market is at least partially to blame. I did pretty quickly drop the price down to $2400. It has been listed at that for weeks and still nothing. I'm not sure what I'm going to do, but really starting to think this isn't the best use of what limited capital I have. May need to rethink my strategy with this property. Still think MTR is a great thing, but will know better what to look for in the future I think. Thanks again!