I mentioned in my last blog that I'd taken a look at questions that landlords typically ask potential property managers. About 37% of investors want to know how the property manager arrives at the market rent? What a great question, as no one likes to leave money on the table when dealing with their investments. An easy answer would be to say that rents are based on the Canadian Mortgage & Housing Corporation (referred to as CMHC) rent rates for the local (Grande Prairie) region. But that would be a mistake.
While CMHC does compile rents from across the City, and we do participate in their surveys, the information is at a minimum six months stale by the time it is published. While it is a good annual indicator it does nothing to help us keep on top of rents. With a portfolio of 1,000+ units under management, Prime Property Management does have an in-house data base we can monitor, but we're much more interested in what the rest of the market is doing. And by having professional leasing agents on staff we are able to stay on top on rental rates by a variety of means.
Our leasing agents review the rents of units on a weekly basis during a stable market. In a volatile market, either rising or falling rapidly, we review the rents daily. Our leasing agents review social media sites offering rentals, Kijji, Rentboard, etc. to watch what private owners are asking for rentals as well as other managers. They have developed relationships with other leasing agents and are able to compare our rates and vacancies with the local industry rates to confirm we are on track.
So in truth the answer to an owners question "How much rent can I get" depends on the day the unit hits the market. But what Prime Property Management can do is show owners how we arrive at the rent so that they are comfortable knowing their rent is at market. However I will caution that once in a while an owner will feel their unit is worth more than the comparable units on the market, mainly because they own it.
An unreasonable rent is asked and the unit sits empty for a month or two. In our opinion that is money the owner will never recover and is bad business. Price your unit fairly using hard data, not emotions, and you'll be much further ahead. And remember Prime Property Management is just a call away and can make all the hassle go away!