Landlords across the United States are experiencing a slowdown in the rental market. If you’re in the position of having a rental that’s vacant right now and it’s been on the market for longer than usual, you’re not the only one.
In general, the housing market for sales and rentals has slowed down considerably. Why does your property seem to rent so quickly and for top dollar sometimes and other times it seems to take forever? Multiple things affect your housing market.
The holidays are usually slow for leasing vacant units as people are traveling or spending time with friends and relatives. Not just renters moving but also getting vendors in to do work when they’re working a limited schedule can make it more difficult to get a property ready between renters. Stores that have supplies may be closed as well.
A lot has happened over the last few years. Many people have sold and bought homes, upsized, downsized, left their jobs, started new careers or businesses, and even moved out of the country as working remotely becomes more acceptable. While people will continue to move and need rentals, the majority who wanted to have and may not want to move again so soon which means there are less people out looking for a new home.
Any property can be rented or sold in any market, it’s just a question of price. If the market is slow for leasing a rental, it means there is more inventory than there are renters looking. When there are significantly more properties available than renters, owners will start to lower prices to increase interest. If you wait, then what you rent it for in a month or two might be less than what it would have rented for today. Waiting is usually not the best course when it’s a slow market for leasing.
Owners typically lose much more in lost rental income than they would’ve if the property had been priced at the current market rates. Waiting doesn’t get the owner more money for their rental, it will rent at whatever the market rent is down the road when the price is lowered enough to match up with what the market will pay.
For example, if your property is rented for $1800 a month but is vacant for 90 days instead of 30 days, then you’ve lost an additional $3600 in rental income. Spread that over the course of 12 months and you would make the same amount of rental income over the course of the year if it had rented for $1500 after 30 days.
Having a property vacant long-term can also affect your insurance coverage and make it more likely to be broken into since vacant properties are more appealing to appliance thieves and squatters than occupied ones.
We’re familiar with the market and see how it changes daily with new properties coming on the market and others being leased. We price rentals at the current market rent to get qualified renters within a reasonable timeframe as having a vacancy for months is not in our clients’ best interest. Give us a call if you need help leasing your rental property.