I've been posting here often recently and I'm a newbie who's targeting SFH (condos) as a niche market in my area.
While looking at some condos in the same good location as my target property, I'm seeing some that are priced way below the market rental value. For instance, one condo unit is about $90k-$100k but is renting at $590 / month. I've seen a few that are like this although some are not very low but still below their supposed market rate. Some are even fully furnished at that.
I'm wondering why some are doing it this way. Are they not really investors but maybe end-users who are happy enough that someone will share their monthly expenditures for that property?
If there are people doing this, bringing down the rental rate, how does one compete?
(Although, I do see some who are pricing their units normally or above the normal rate.)
The market rate is not the advertised price it is the price the units rent for. The below market rents might be someone who needs a quick fill or it could be a misdirect like rent with option to buy which includes a fee. Furnished could be short term with heavy owner use and limited availability.
I would just insure you are in the mid-range for the units. See what things rent for by looking online at things disappear from availability quickly and talking to local agents. If your complex is large enough you can talk to other owners. Is this in the Philippines where you said you were looking to get started? If so talk to a local rental agent and discuss what units rent for. In our area student rentals mixed with what I would call adult rentals make the market rent a little hard to nail down if you don't know the area and these two different rental groups.
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