It can be a balancing act when it comes to how much rent you decide to charge. Overprice your listing and you’ll send valuable tenants running for the hills. Sell yourself short and your cash flow will struggle.

So, the million-dollar question is: How do you know how much rent to charge?

At :Different we want you to rest easy knowing the rent you've advertised your property at is the right one. So we decided to give you full transparency in the tools we use and the work that we do to set the rent on your investment property, with some help from our Head of Growth & Leasing, Kasey McDonald.

We are all about transparency, so we'll share how we arrive at the right rental rate.

Kasey explains that our rental appraisal process boils down to 3 steps:

1. Research what similar properties (size, condition, features etc.) have recently been leased for.
2. Review current listings to gauge whether similar properties are common or rare in the area.
3. Assess market vacancy rates and how many days properties remain on the market to determine how fast properties are leasing in the area.

When it comes to appraisals, our accuracy is only as good as the tools at our disposal. Core Logic, SQM Research, REA and Domain reports are just some of the databases that give us the edge on those detailed market insights.

Our initial analysis is the first step, but we know that the work is not done until your rental property is tenanted.

As Kasey explains, there are a few key performance indicators we monitor before suggesting a price adjustment:

• Online engagement: Prospective tenants’ first point of contact is almost always through online portals. But if they don’t review the listing and register for an inspection, especially within the first week of it being LIVE, then that’s strike one.
• Inquiries and attendance: If the first inspection doesn’t see the level of interest and attendance that we would have expected based on market research, that’s another indicator that a price adjustment may be in order.
• Applicant feedback: Lastly, we consider the feedback we receive from prospective tenants who attend the inspections – a clear cut way of gauging what’s working and what might need some tweaking.

In the end, our goal is to minimize your vacancy period as much as we can. We know that dropping the rent by a few bucks a week is better for your cash flow if it means you cut your vacancy a week short.

Part of the picture is that we want you to get the maximum returns from your investment property.

Before we go the nine yards to set your rental at the golden price in line with market data, we like to do all we can to bump up the appeal of your property before your rental even touches the Domain listing page.

Along our process, we have a chat with you about ways that you can increase your rental yield, and small improvements to help make your investment property stand out.

Getting the right rent is an iterative process, and while everyone makes mistakes, our commitment to monitoring the performance of your rental advertisements along with our focus on increasing the appeal on your investment property will ensure you keep your vacancy rates at a minimum.

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