Owning rental property can be a great way to earn an additional – or even a full-time – income. But, if you have units that you’re preparing to list for lease, you may be wondering just how much to charge for the monthly rent.
In most cases, the amount of rent that a property owner charges will be a percentage of the property’s overall market value. Here, for instance, property owners will generally charge somewhere between 0.8% and 1.1% of the value of the home.
So, for example, if the property is valued at $150,000, then the appropriate amount of rent to charge would fall somewhere between $1,200 and $1,650. The figure would be calculated as follows:
$150,000 X .008 = $1,200
$150,000 X .011 = $1,650
Once you have determined the approximate amount of monthly rent to charge based on these factors, there are also some other criteria that could influence the final monthly rent figure. For instance, if a tenant has a pet (or pets), most property owners will increase the amount of rent – usually in the $25 to $100 per month range. An initial up-front pet deposit is typically also added as well. This can help to offset any damage that may be caused by the pet.
Likewise, some landlords may also charge more, based on the situation, such as if a tenant is a smoker. Here, too, the additional amount of rent that is charged can help with offsetting the added expense of preparing the home for the next tenant in the future.
Managing and maintaining rental property can take up a considerable amount of time. So, if this is time that you just simply do not have, turning these responsibilities over to a property manager could make sense.
If you own rental units in Central Florida, then give us a call today to find out how hiring a professional property manager may make sense.