It's wise to seek advice when you get started in real estate. But you'll soon discover a problem: not everyone is on the same page, and not everyone will offer the same tips. Sometimes, you'll hear contradictory advice.
So, if you are feeling stuck, we are here to help. We've compiled this short guide to help dispel some real estate myths, specifically your rental valuation. Here is what you need to know about rental pricing in Auburn Hills.
Myth: Rental Pricing Is the Same Throughout Auburn Hills
It's tempting to begin your pricing research by looking at similar properties in Auburn Hills. However, a smarter approach is to research the property's specific location in more detail.
Proximity to amenities like schools and shops will impact the price. Some streets will also be more pleasant and sought-after than others.
Myth: The Price Doesn't Change Throughout the Year
Don't ignore the impact on the time of year you list your property for sale. It could affect the rental valuation. Plus, a dip in demand isn't necessarily an indication that you've priced too high.
You may be at a seasonal low point. Demand will spike during the beginning of the academic year when students look for housing.
Myth: Older Properties Rent for Lower Prices
If you have an older property, don't despair. While some tenants are attracted to the style of new properties, some people prefer the charm of an older one.
The trick to keeping your price high is to ensure it's in excellent condition. When advertising it, focus on its strengths, like the location or space.
Myth: Low Prices Are Perceived as Low Quality
Sometimes, you'll hear advice about not pricing your property too low. The logic is that tenants automatically assume it's undesirable and low quality.
However, sometimes a low price can be a strategic move. For example, you could offer it in exchange for an extended tenancy agreement. You must also weigh the costs of keeping your property vacant for too long.
Myth: Prices Are Based on the Property's Size
Don't let your property's square footage dominate your pricing strategy. Size is relevant, but so are other factors like location. You also have to consider the practicality of your property.
A three-bedroom property could command a higher price than a two-bedroom one, even if the latter has more square footage.
Myth: High Rates Equal High Profits
Life would be simple if a higher rate equated to a higher profit. But it's easy to see why this logic is flawed. All landlords would keep raising their property rental rates to improve their profit margins.
In reality, it's more about supply and demand. You can only increase your prices when property supply is limited and there is a high demand from tenants.
Dispelling the Myths on Rental Valuation
There is a lot of misleading advice about real estate success. So, it's important to dispel some of the myths of rental valuation. Ultimately, high profits mean taking a research-led approach to pricing.
That's the approach we take at PMI Great Lakes.
We offer an efficient, friendly, and professional real estate team in Michigan and are here to help you maximize your rental income. Try us for yourselves by completing our free rental analysis.
