Vacancy: The Biggest Cost to Owner's of Rental Property

Do you currently have a vacancy? Did you account for vacancy periods when you began your journey as a landlord? Whether you did or did not, times of vacancy in the world of owning a rental property hit hard- and mostly in the checkbook. The winter months especially, can pose unwanted stress on landlords like no others, having to worry about keeping a vacant space heated enough so pipes don't freeze, etc. Being in the business of property management, we know for a fact that VACANCY/TURNOVER is hands down the BIGGEST COST for owners.

OUCH, RIGHT IN THE CHECKBOOK

Every week or month that goes by un-rented = hundreds or thousands of dollars in lost revenue.While revenue is being LOST, bills are still being FOUND: mortgage payments, hazard insurance, property taxes, utilities, landscaping, snow removal, maintenance ….oh my! We’re not in Kansas anymore Toto.

The Season is Not the Only Reason

The time of the year is just one of several factors that impact vacancy periods. Here are some of the other violent offenders:

1.) Pricing- Too high? (compared to similar units and/or for the tenants you’re targeting).

2.) Condition/Age of the property- Property needs visible work? Is it pleasing to the eye?

3.) Location & proximity to amenities- Have you highlighted easy access to highways or public transportation? Is it near a historic district, university,or large employer? All pluses for renters.

4.) Visibility- Is the listing visible enough? Is it on multiple websites online (which increases chances dramatically)?

Expert Tip: The day a tenant vacates is when a handyman should assess repairs & begin the "make-ready" process. Days passing while he's "getting around to it" costs you $. Consider taking a video too (the camera never lies).

ZERO VACANCY RENT : A LANDLORDS DREAM

There is no magic number for the average days a rental is on the market for. A zero vacancy rent is a landlord's dream; however, there is a price to pay if not done correctly. If a place is renting in well below “the average time” (around 20-40 days depending on time of year) at least one of the following is probably true:

the rental rate is too low

the rental criteria is too low

You want traffic; but, an overabundance can be a red flag that you could be asking for too little in rent. As far as criteria is concerned, you should look for someone who makes at least 3x the rental rate in gross monthly income, has a positive rental history, and solid credit score. If your only criteria is having the 1st months rent & security deposit- don’t be surprised by problems down the road. On the other hand, if your rental criteria is too stringent (i.e., looking for perfect credit), you risk above average vacancy rates & getting whacked in the wallet longer.

Expert Tip: Include in your lease (as we do at Robert C. White) a clause that allows you to begin marketing and showing the unit before your current tenant vacates. If you can show the property while tenants are still in place, you may be able to eliminate any vacancy!

FILLING YOUR VACANCY IS OUR BUSINESS 

As expert Property Managers, Robert C. White & Company understands your bottom line. The leasing team works tirelessly to fill vacancies ASAP after completing a rigorous screening process that has proven effective! With working, taking care of children, and other responsibilities, you probably don't have the necessary time it takes to get your home rented as quickly as it can be. 

WE HAVE THE TIME! It's what we do. Give us a call today to see if we can help 860-613-6290.