Whether you’re a new landlord or have been managing your rental properties for years, determining the most accurate price isn’t always a straightforward and easy task. Pricing too high risks leaving your property empty for months, which is a waste of money. Pricing too low means you’re still missing out on income potential.
At flatimo we often help our clients with pricing. We even have property calculator, which provides a free personal property valuation and a recommendation for a monthly rent amount or sales price for your rental property in Sofia.
If you still decide to tackle this task yourself, we offer a few tips and practices that will get you as close as possible to the perfect price.
Do an analysis
A common mistake is to base the price on a single source. For example, an owner goes to a listings site, sees the active listings, and is led astray by them.
The truth is that most sites have fake and inactive ads. It is also important when doing research to keep in mind that in addition to fake ads, there are also ads that have been on the portal for months, precisely because their price is inflated. In fact, the market price is almost always lower than what is described on the portals.
For the most accurate result, compare as many listings as possible on as many portals as possible. You might even call them to check if they are real. Also use forums, social media groups, and communication channels. The more information you can gather, the closer you will get to the ✨perfect price✨.
When comparing, pay attention to the following parameters and factors:
- Location, area, building
- Furnishing, latest renovation, energy efficiency
- Floor, exhibition
- General condition (depreciation, age of furniture, number of previous tenants, etc.)
- Additional spaces (basement, attic, garage, parking space)
- Amenities and extras:
- Air conditioner
- Comfortable mattress
- Blackout (blinds, curtains)
- Complete and functional furnishings
- High-end furniture and appliances
The list can go on and on, but these are the main factors with the greatest weight in determining the price.
How to work with factors?
Unfortunately, there is no exact formula that we can use to easily calculate the price. One trick we can apply is to determine an “average price for the area” as it is almost always lower than what is seen on the platforms, for the reasons mentioned earlier.
Once you have determined the average price, a very easy rule that almost always applies is the following: new and well-maintained apartment = above average price. Older and depreciated furniture = below average price.
Rarely is the assessment formed so easily, so we can look at the pros and cons and see where the scales will tip. For example, in a brand new apartment, but in an old building - for the tenant, the interior, the apartment and the comfort in it are more important than the vision of the building, since his interest extends over several years. In this case, a price above the average is justified.
On the other hand, a brand new apartment in a brand new building, but with very cheap furnishings or even incomplete furnishings, cannot cost more than average.
And of course, an older and shabby property cannot compete with the average priced ones on the market (yes, even if it is "freshened up" and repainted 😊).
Listen to the market
The strongest indication of an unrealistic price is when you have advertised the property in dozens of places, sponsored posts and ads, but still do not receive calls from direct tenants, but only from agencies offering to work with you. Do not let such a property sit for too long, the faster you make a price adjustment, the more losses you will save yourself.
Or maybe you’re at the other extreme? You’re conducting a lot of viewings, but no one is showing serious interest. Always ask for feedback from people who have come to view – you’ll understand the reasons why they’re turning them down and you’ll be able to take appropriate action. One of the most common reasons for rejection of an adequately priced apartment is the terms of the contract, such as requiring a deposit of two or more months’ rent. An alternative that we’ve found to work is to reduce this deposit to 1.5 times the rent. This way, the owner is more at ease and the tenant is more likely to agree.
Another common reason for rejecting a prospective tenant is the lack of a key electrical appliance or piece of furniture (such as a heater or a functional bedroom).
Summary
The right price for a property is not found through a one-time formula. It is a process of analysis, adaptation and attention to the market. The more flexible and realistic your expectations are, the faster you will find a reliable tenant and avoid unnecessary losses. Don't be fooled by online ads, don't ignore feedback from viewings and remember that details often decide the deal. And if you want to save time and get a reliable reference point today – use our free property calculator at flatimo.bg and find out the ✨perfect price✨ for your property.
We hope this article was helpful to you. If you are still having difficulty renting out your property, don't hesitate to contact us for a free consultation.
