What is your price block?

When tenants look for property, they go online and do a search. They have items in mind of what they are looking for, location, number of beds etc. Read this post that I wrote recently, talking specifically about these items. 

But by far and away the key item that will get prospective tenants considering your property is price. This is especially true in this day and age when people are becoming more and more fiscally responsible. People look for property in 'price blocks', they have a budget in mind and due to website design, prospective tenants will key in search values  for price such as between  $300 - $400 per week. So where does your property sit? What is the average rent in your city? In the suburb your rental property is located? Does the rent on your property fall within a predictable 'price block'?

When vacancy rates start rising and there is more choice for the tenant, then their first introduction to your property  will be price. If your property is just outside this block, you need to weigh up the pros and cons of dropping it. You need to consider - for example - if a $5 drop from say $405p/w to $400 p/w would effect your bottom line vs getting your property off the 'vacancy books' faster? Your property will show up in a lot more searches and the pool of prospective tenants will increase substantially.

If you sign a 6-month lease, that is a $130 loss. Doesn't seem so bad does it? Also it may mean that you get your property tenanted in a week, rather than letting it sit there for 3-months losing you valuable income.

Plus of course, you can increase the rent back up to $405 after the requisite time period.

Let me assure you I don't advocate this right off the bat. We need to consider what the comparable properties are in the area the rental it situated, how long it has been vacant and if your rental ticks lots of boxes. Your property will have to tick more than just the 'price box' (see here) to get it rented quickly.

Do you have your property in the right price block? Are you keeping people away for an extra $5?