Milwaukee market conditions - property not renting

Rental Property Investor · SF South Bay, CA · Member since 2017 · 8 posts · 1 vote

Hi Everyone,

I have a new 3/1 SFH 1000sf in great condition that has been sitting on the rental market for almost 2 months now. My other property there rented in less than a week back in 2017.

I'm out of state. Anyone know if the market conditions changed so much there?

Thanks

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Matt Maurice

Property Manager · Milwaukee, WI · Member since 2014 · 113 posts · 144 votes

To piggyback @Nathan Gesner comments, you've clearly got a problem if something is on the market for 2 months. We do see DOM tick up this time of year, but not to that extent.

Have you reviewed your manager's screening criteria? Ensure that you don't have a mix match in criteria to the property location. (looking for an A resident in a D location, for instance).

If they aren't already providing it, ask your manager for the weekly inquiries, showings, and applications. Most PM software spits these numbers out very easily, and this is how you can dive into further issues. Inquiries are low? It's a price problem. Showings are high but nobody is filling out an application? It's a condition problem.

Asking for the data will also help you determine if your manager is putting forth proper effort to get the place rented. Ask them for averages across their other current vacancies to see where your property falls.

Most of the year we average around a 10-14 day post to lease average. This time of year we see that very quickly jump to 25 - 30 days, particularly in our lower rent properties as we don't bend on our standard screening criteria. The only time we see something sit for 2-months is when clients don't drop the price, generally against our suggestions.

Hope that helps!

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Nathan GesnerBusiness Member
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Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
6y
The market is hot. You've over-priced it, it doesn't have the amenities people need, or there's too much competition.
Since you are out of state, who's studying the market for you? Who's advertising? Why can't they answer this question for you?
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JC Rav
OP
Rental Property Investor · SF South Bay, CA · Member since 2017 · 8 posts · 1 vote
6y
Thanks. I use Prestige Property Management. They were also the REA for the purchase. It's been a challenge to get details why the property does not rent.
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Matt Maurice
Property Manager · Milwaukee, WI · Member since 2014 · 113 posts · 144 votes
6y
To piggyback @Nathan Gesner comments, you've clearly got a problem if something is on the market for 2 months. We do see DOM tick up this time of year, but not to that extent.
Have you reviewed your manager's screening criteria? Ensure that you don't have a mix match in criteria to the property location. (looking for an A resident in a D location, for instance).
If they aren't already providing it, ask your manager for the weekly inquiries, showings, and applications. Most PM software spits these numbers out very easily, and this is how you can dive into further issues. Inquiries are low? It's a price problem. Showings are high but nobody is filling out an application? It's a condition problem.
Asking for the data will also help you determine if your manager is putting forth proper effort to get the place rented. Ask them for averages across their other current vacancies to see where your property falls.
Most of the year we average around a 10-14 day post to lease average. This time of year we see that very quickly jump to 25 - 30 days, particularly in our lower rent properties as we don't bend on our standard screening criteria. The only time we see something sit for 2-months is when clients don't drop the price, generally against our suggestions.
Hope that helps!
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JC Rav
OP
Rental Property Investor · SF South Bay, CA · Member since 2017 · 8 posts · 1 vote
6y
Thanks @Matt Maurice this helps a lot! I asked for the numbers, will see what they look like. In this case I'm the one pushing for a price reduction which has not happened as far as I can tell.
Listing here.https://www.zillow.com/homedet...
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Matt Maurice
Property Manager · Milwaukee, WI · Member since 2014 · 113 posts · 144 votes
6y
@JC Rav the place looks good, if that hot tub is still there I'd suggest you remove that asap. Nothing good can come from renting a house with a hot tub...
On your Zillow link, one of the first things on there is: Note: This property is not currently for sale or for rent. The description below may be from a previous listing.
I also didn't see an advertised price, it doesn't appear this listing is live.

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Dawn AnastasiPro Member
Rental Property Investor · Milwaukee, WI · Member since 2013 · 6k+ posts · 4k+ votes
6y
I see you are renting it for $1,395/mo. Instead of dropping the rent, try a "move-in special". Dropping the rent is something that affects you month after month, a move-in special is a one-time thing. For example, if you'd drop the rent $50/mo, instead try a $500 off first month's rent move-in special. It will save you money over dropping the rent.
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JC Rav
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Rental Property Investor · SF South Bay, CA · Member since 2017 · 8 posts · 1 vote
6y
Thanks for the great advises @Matt Maurice and @Dawn Anastasi
I thought the same about the hot tub but my PM seems to thing it added value. I'll talk to her. Otherwise yes, the place looks good, I replaced the furnace and AC. From what I understand the drawbacks are no basement and the garage is only 1 car. This is the kind of things hard to figure out since where I live basements don't exist and nobody parks their car in garages ;-)
From the info sent by the PM we got 3 applications that were largely underqualified (no employments, evicted,...) My sense is reasonable prospects know they can't afford the rent and don't apply.
Thanks again !
JC
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Matt Maurice
Property Manager · Milwaukee, WI · Member since 2014 · 113 posts · 144 votes
6y
$1,395 this time of year with no basement and under 1,000 square feet I think you are very high. During leasing season, I think you can get $1,295 but I'd be advertising that property for $1,195 this time of year AND potentially a move-in special.
Look no further, the price is the problem.
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Marcus Auerbach
Investor · Milwaukee - Mequon, WI · Member since 2010 · 5k+ posts · 7k+ votes
6y
Originally posted by @JC Rav:
Hi Everyone,

I have a new 3/1 SFH 1000sf in great condition that has been sitting on the rental market for almost 2 months now. My other property there rented in less than a week back in 2017.

I'm out of state. Anyone know if the market conditions changed so much there?

Thanks

JC

Hi JC, you must have worked with someone awesome in 2017 lol
Funny thing is - I had not seen your post on Monday when I called you and suggested to call WHM..
The rental market in Milwaukee has not changed much in the last years, rents have gone up a little, but in terms of demand it's still the same. And your place rented at the worst possible time of the year, between Christmas and New Year, right? I had another one at the same time, very similar and same area but slightly smaller for rent and you got literally 50% more inquiries - because people are looking for space - square footage matters! I keep hammering it with new investors. Rent is always a function of space, basically a buck a foot - my biggest mistake ten years ago when I bought my first duplex was size. it came down to two properties, and I went for the cheaper one: I could have bought the other one for 15% more money - and 50% more space.

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