Before we get into the specifics on validating your rent, let’s quickly review the prerequisites to success with listing your property.
Which sites should I use?
In our experience at Showdigs, Zillow and Zumper brought the vast majority of leads in 2019 so having a listing built in each of them is key. Ten years ago, the go-to was Craigslist, which may still have traction in your area but whether or not you use this, or other listing services, in most areas you’ll get the most bang for your efforts with Zillow.
People see themselves in your property
It is extremely important that your descriptions and photos tell a story about how your property can benefit each potential resident. Accurately, but creatively describing your property and all of it’s best amenities is key. In addition, photo quality is paramount. If a prospect is imagining themselves living in your property, you want to provide high quality photos and enough of them to get a great tour of the home. This would include all bedrooms and bathrooms, living areas, kitchen, a view if available, the yard, the front of the home or entry of the building, and any shared spaces.
How do I pick a price?
In 2019 Zillow invested over a million in their rental algorithm so spend some time browsing around your neighborhood looking for similar properties. Finding a “model” property that is most similar to yours is a great start. Then browse further and take notes on what makes each higher or lower than the other. Does one have more square footage? Does another have more modern appliances? Does the location in the neighborhood or walkability of the property impact the property's price? Is there a similar yard, view or building amenities?
Next, find 3-5 properties to watch that are similar to yours. Consider one that is as identical as possible, one that is a bit more premium, either by value or location, and another that is a bit more budget oriented. You’ll use these later to monitor your progress.
After you have determined a price range, consider starting toward the higher end of your range for the first week of advertising.
Be available to respond to interested renters
To lease your property for an optimal rental amount, you need to capitalize on each renter that shows interest in your property. That starts with responding to interested renters, who inquire around the clock as demonstrated in our diagram. We recommend you set up an auto-response that will ensure you get back to renters immediately, at any hour.
Be available to show the property
Before renters will sign a lease, they'll want to view your property. They'll also be viewing competitive properties. To make sure you get renters in quickly and consistently, cater to their schedule. Offer them showing times that work for them. We have found that over 60% of showings are on nights and weekends: see our article on popular showing times.
Monitor and compare your progress with other listings
OK, now that you’ve listed and you are ready to start scheduling it is important to monitor the key metrics on Zillow. You’ll see in your, and other, Zillow listing that there is a set of statistics: Days listed, Contacts, and Applications. In an average economy we would expect to see 10-12 contacts which should yield 3 showings.
So after 5-7 days, take a look at how things are trending. If you are below your expectations, take a look at the 3-5 other listings that you are monitoring and see how they are trending. If they are doing better than you, first evaluate the quality of their listing. If it is at par with yours, you may need to reconsider your price point. If they are doing the same or worse than you on average, you should maintain your price to collect more data for another week.
One example we monitored in Seattle, as of the date this article was written, was still listed after 79 days when other similar inventory had been rented in a matter of weeks.
Long vacancies mean lost revenue for our owners
We all want to minimize days on the market for our owners so using this strategy as well as others with other listing sites or market data will help us all serve owners better. You may also consider companies like Showdigs where we can optimize your tours by getting prospects in the door, in some cases within an hour.