How To Maximize Your Rental Income
November 05, 2018
Let's all agree, for those of us who own an apartment and plan on renting it out to tenants, you want to get the best price for your investment. At the same, time, you don’t want to miss out on a potential tenant, because they can't or won't pay the monthly amount you are asking for an apartment for rent. When renting out your apartment in Jerusalem, we suggest taking the following steps when considering what to price it at:
Step 1: Time of Year
Depending on the time of year your apartment is vacant for tenancy has a big impact on the price. While there are people who do need long term rentals throughout the entire year, most people are not ready or willing to move until the summer months (July-September) These months would be considered "prime season" for long term rentals. Families tend not to want to move in the middle of the year so as not to disrupt school and other such commitments, and university students like to move in the summer months so as they can be ready and organized for when the academic school year starts in October.
For furnished and fully equipped apartments, foreigners and diplomats tend to like to move in the summer months and sometimes in the winter months, such as December or January time. So if you are renting your apartment in Jerusalem in November or February it is worthwhile to keep this in mind and the group of people looking for an apartment may not be as high.
Step 2: Competitive Pricing
When deciding on how to price your apartment for a monthly rental, its also important to take into consideration what other similar apartments are being priced at. In addition, what other aspects of the apartment are there? For example: amenities, elevator, parking, balcony, location, condition, lobby, etc. This will help give you an idea of what is reasonable to ask for. Also, keeping in mind the time of year. You want to compare prices of apartments that are available during the same season as the one you are trying to rent. An apartment that is for rent in August will most definitely be going for a different price in November.
Step 3: Unique Features
There are some features of apartments that are rare and not common to find, in which case this can certainly have an impact on the price. Once you’ve taken into consideration the 2 steps mentioned above, if the apartment has something that sticks out, it may in fact make it more appealing to people who are looking for an apartment. Such features may include, but are not limited to: private garden, private roof, private entrance, full accessibility (wheelchair accessible)
After following steps 1-3 as a guideline for your price, and your apartment is still vacant for a few months, you may be wondering what you can do now…
If you priced your apartment for rent according to its unique features, it could be that that the current clientele looking for apartments, do not require those unique features. In cases such as these though those unique features contributed to the increased price, potential renters may choose a different apartment that is less expensive and does not have those unique features.
If you are renting your apartment during the "off season" months (October – December and then again from February to July) there isn’t a high need to apartments, thus there aren’t many people looking for apartments, so it remains vacant.
These or any other such reasons can all be associated with a vacant apartment rental in Jerusalem. It is important to keep in mind though, that as long as the apartment is vacant, the bills still need to be paid. Which means, monthly bills such as Arnona, Vaad Bayit, etc, that normally the tenant will be, will end up coming out of your pocket until the apartment is rented.
If you have been unsuccessful at renting your apartment for a few months, it may be worthwhile to sit and reassess the price you are asking, as in the long run it may end up costing you more if the apartment is vacant for too long.
Here at Alon Central, we highly reccommend speaking witha professional on the matter who understand the matter and can provide guidance and assistance. Be sure to contact us at Alon Central as this is one of the many things our professional agents can advise on.