HomeSetting the Rental Price for Your Investment PropertyBlogSetting the Rental Price for Your Investment Property

Setting the Rental Price for Your Investment Property

When it comes to setting the right rental price for your investment property, particularly in areas like St George, finding that sweet spot is important. You want to get the most out of your investment without turning prospective tenants away. The rental market has shifted in recent months, and knowing how to deal with these changes is essential to ensuring your property doesn’t sit vacant longer than necessary.

Understanding the Current Market in St George

Over the past year, the rental market in St George has seen some notable changes. While rental prices have risen, so have the days a property spends on the market. According to data from Realestate.com.au, the average rent for units in St George is now $850 per week, a significant jump from last year. However, the number of rental properties available has also increased, resulting in longer vacancies. Twelve months ago, properties in St George were snapped up in just one week; today, it’s taking two to three weeks for many landlords to find new tenants .

This longer vacancy period can have a direct impact on your overall returns. Every week that your property remains vacant, you lose almost 2% of your annual income. That’s why setting the right rental price from the start is more important than ever.

Maximising Return Without Turning Tenants Away

While it might be tempting to set a high rental price to maximise your profits, pushing too far beyond the current market rate can backfire. Overpricing your property might scare off potential tenants, leading to longer vacancy periods and ultimately costing you more than you would gain from a slightly higher rent.

It’s essential to strike a balance between attracting quality tenants and securing the best possible return. One of the key factors is being realistic about market conditions. As we’ve seen in St George, there are more rental properties available now than a year ago, which means tenants have more options. With this in mind, setting a competitive price that reflects the current demand can make all the difference.

How a Good Property Manager Can Help

Dealing with these current market conditions requires expertise, which is why having a skilled property manager is important. A good property manager not only understands the local market but also knows how to position your property to appeal to the widest pool of potential tenants. From staging and photography to crafting an appealing listing, there are many ways to ensure your property stands out in a competitive market.

Moreover, property managers at agencies like our team at Mclaws Property are experienced in monitoring local rental trends and ensuring that your rental price is aligned with market conditions. Through constantly reviewing rental prices and making adjustments when needed, they help you minimise vacancy periods while maximising overall returns. 

For every week that your property sits vacant, you’re losing almost 2% of your annual return. It’s all about setting a price that attracts tenants quickly, without compromising on your rental income.

The Impact of Days on Market

As mentioned earlier, the number of days on the market is a critical factor in determining your rental yield. Even if you set a slightly lower rental price initially, you might end up earning more over the course of the year by avoiding extended vacancy periods. This strategy ensures a steady cash flow and keeps your property occupied, which is the ultimate goal for any investor.

The data supports this approach. According to Realestate.com.au, despite rental prices rising, the increased number of available properties has made tenants more selective.

To highlight the data, “St George has seen an annual compound growth rate of 3.0% for houses and 7.5% for units.” 

As a result, properties are sitting on the market longer than they were just 12 months ago . This means landlords must be strategic about pricing and marketing to minimise downtime and protect their returns.

Utilising Local Knowledge

Having a local expert on your side is invaluable. At Mclaws Property, our team knows the St George market inside and out, and we keep a close eye on trends to ensure that your property is priced right. Whether it’s a residential unit or a free-standing house, we understand the nuances of this area and use that knowledge to help you make informed decisions.

In addition, our multilingual team, fluent in English, Mandarin, and Cantonese, ensures clear communication with a diverse range of potential tenants, further widening your property’s appeal.

Achieving the Perfect Balance

Setting the right rental price for your investment property is a balancing act. In today’s market, especially in a dynamic area like St George, you need to be competitive without underselling your asset. A great property manager can guide you through this process, helping you set a price that attracts tenants quickly while maximising your return.

With vacancies up and tenants becoming more selective, now is the time to work with experts who understand the intricacies of the market. At Mclaws Property, we’re here to help you navigate these challenges and achieve the best possible outcome for your investment.

For a free rental appraisal, contact us today at McLaws Property. Let’s make sure your property is priced right and ready to rent in today’s market.


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