Investor · Seattle, WA · Member since 2015 · 55 posts · 33 votes
Hi BP!
I am renting out my condo and in an effort to be competitive I priced my unit at $1850/mo. I have since received 3 really good applicants from people that I would happily rent to.
Is there any way to claw back and get more for the rent? I am asking because this seems unethical.
Also - any advice on how to eliminate one tenant versus the other?
I am renting out my condo and in an effort to be competitive I priced my unit at $1850/mo. I have since received 3 really good applicants from people that I would happily rent to.
Is there any way to claw back and get more for the rent? I am asking because this seems unethical.
Also - any advice on how to eliminate one tenant versus the other?
Thanks!
Adam
I would not do that - raise rents. You could next time around but it is a damage to your reputation. I eliminate first based on credit score, then work, then rental history. Hope that helps.
Investor · Seattle, WA · Member since 2015 · 55 posts · 33 votes
6y
@John Teachout
Hi John - words of wisdom thank you. I posted at $2k/mo and didn’t get any bites. Lowered to $1850/mo per guidance of local friends who are always in the rental market and said I was over priced.
I wanted it to move so those two factors are why I lowered it so correct - success.
I posed the question as the majority of yours I did cane with comments like “wow this is a really good deal” which in my mind sounded like “dude - you’re leaving money on the table”
Lesson learned on this one, I’m not going to re-trade the rate on my prospects. I’ll pick the best one and be happy with overall success of my first rental project.
They all have dogs (Seattle) so I can probably squeeze a bit more on pet rent if I really want to get cute. TBD on that one.
Rental Property Investor · Dayton, OH · Member since 2019 · 293 posts · 440 votes
6y
@Adam Sharp I’ve read all the comments and I think your question was a good one if your a new investor. However, your last post has me scratching my head. You listed it at 2k and had 0 bites? You listed it at $1,850 and you had 3 bites, so what do you want to raise it to? ($1950 since nobody bit at 2k??). I know you already conceded you were not going to try this and that is the RIGHT decision, but I want to make a simple observation here.
If you get $100 more per month, that’s an extra $1200 for the year. If $1,200 makes your numbers work and changes your life, you need to find better deals!
The better way to look at this is to know what rent achieves your goal for the property. Use that number as long as its in line with the comp rents and don’t ever ask this question again.
Greed is the evil cousin of success and yes what your asking is unethical and in many areas, against fair housing or at least tip toeing the line.
And.......it’s not being “cute” to charge a pet fee. That’s what most experienced investors do if they accept pets.
Investor · Seattle, WA · Member since 2015 · 55 posts · 33 votes
6y
@Todd Pultz
Hi Todd - your observation is spot on. The question was meant to be more theoretical as I had never thought through or encountered this situation.
Agreed $1.2k/yr is not enough to retire on but every penny counts. The condo was purchased as my primary residence (for the last 4yrs) not necessarily as an investment opportunity. The bldg is 1 unit under the rental cap so I decided to strike.
The Seattle market is tough with most developers offering 2mos free downtown just to get tenants in the door which I can’t do so I priced my unit to move fast and get a tenant in Oct1 before the slower winter season takes hold.
I’m not cleaning up by any means but I took the opportunity I had in front of me with the chips I had on the table. Future, pure investment, plays will be scrutinized from the perspective you outline in your observation.
Rental Property Investor · Northern, CA · Member since 2012 · 5k+ posts · 5k+ votes
6y
@Adam Sharp Having multiple applicants to chose from is a good position to be in, but 3 applications is not a lot of applications. Sounds like you’re priced just about right (especially since you got zero bites at the higher price you tried to rent it at).
Personally, I’d keep the rent at where you advertised it.
Sacramento, CA · Member since 2014 · 513 posts · 319 votes
6y
No, raising the rent after the fact is unethical and may be illegal in your state opening you up to a fair housing violation. Even if this is not the case, it sets the wrong tone for your business relationship and will earn you the reputation g g
Rental Property Investor · Ankeny, IA · Member since 2017 · 2k+ posts · 3k+ votes
6y
Hmmmmm.....some very strange ideas and strategies listed here.
Some peoples plan is to list in lease there will be a raise in rent every year? Why? What does that do, other than possibly scare off people. Look, if the lease is up and it warrants a raise in rent, then you simply raise the rent. Does any other business let you know that there will be a raise in price in the future? I have no idea what that does for the landlord. Also, every time I have a vacant unit, that is when I analyze what the new rent will be. Sometimes, it warrants rent staying the same. Mostly, it warrants at least a slight increase. And no, I have never lowered rent. Set your terms at the time of renewal, and let the tenant make their decision.
A bidding war amongst qualified candidates? Sure, let's make sure your new tenant dislikes you right out of the gate. Or better yet, chase away all three candidates! The reason why you don't do this, while doing the opposite when you sell a property is.....Because the tenants are going to be living in your house!
Now, unless I missed it, a better question would be; "Look at these three applicants. Which one would you choose?" Barring that, be happy that you have three really good candidates for the price you set, and pick one of them according to the criteria that you set. During these times, I would focus more on length of employment over FICO Score, assuming everybody meets your minimum criteria. And then you simply tell the other two; "Thanks for your interest, the unit has been rented". And if you really think you set the rate too low, you can always do a MTM lease and evaluate raising that rent in about six months.