Last Friday I posted my latest fixer-upper on Zillow at an advertised rent of $950/month. Market rent for similar 2/1 houses in this Class C neighborhood is approx. $700-$800/month. I put my advertised rent at $950 just to see what would happen if I went above market. I was tempted to advertise at a $1,000 but my greed gland started bothering me so I decided to keep it under $1K.

First of all, at $950.00, I am getting responses but not the usual FLOOD of responses from unqualified desperate prospects who will answer any Zillow Ad regardless of the rent amount. I am getting some of those but not the usual flood of them. The few good responses I am getting are coming from tenants who are currently paying approx. $950-$1,100 in more affluent sections of town. Maybe they see my house as a bargain?

Royal -

Several here made that suggestion to you.

Another reason I went above market is because this house has just completed a major rehab. Painted the house outside and in, new plumbing fixtures, updated the electricity up to code, new Heat Pump, new kitchen cabinets/counter tops and a new roof. This house looks almost brand new at this point. I wanted to know if anyone would be willing pay a little more in rent to get this new looking house versus some of the other worn out rental houses on the block.

My current vacancy hovers at market rate. 1371 sq feet, 3bdrm 1 bath. all new plumbing, electrical, heating system. New vinyl siding Class C area. "O's replaced by zeroes.

zill0w.c0m/h0medetails/Ly0ns-NY-14489/2061913949_zpid/?view=public

Congratulations.

MikeA,

The newness factor is huge. Our photos are all empty, first-time renovated places. They come and VIEW a place that is cared for but lived in. We get our advertised price because we keep it affordable to the middle masses, but above the riff-raff. Plenty of riff-raff still ask, but not as many, and we filter them out.

Too much UNDER market is worse than over. You'll fill it but with who?

Small potatoes,

My house is not rented yet. I have showed the house to only two prospects so far. Both have completed a Zillow App and now they are filling my 2-page paper application. However, there is no guarantee my house will end up renting at the above market rate.

What I did here was to 'test my tenant pool' just to see who (or how many) would respond to above market rent. The jury is still out here. If my house is not rented in the first 10 days, I will make some adjustments to my rent.

Thanks WMH for your reply. I try to do the same as you,...get rent that is affordable to the middle masses but above the riff-raff. Here riff-raff rent is $500-$600/month and some of these folks are living just next door.

Nice Job Roy.

You have provided an excellent example for others to follow. When people only moan and groan that there location is either bad because they only get non-quals, I think one of two things are going wrong if the problem persist.

Either the home/location is bad or they are marketing the place in the wrong manner. There are lots of things an investor can do with a place, moving it isn't one of them typically. So assuming an investor uses good judgement on where to buy (and again, one has to assume or be an expert in every area in America), it boils down to marketing or material condition.

Congrats on getting a good rent, Roy.

"Above market"... "Below Market".... I believe there is only AT market rent. Your house is a higher quality than your comps, so it's kind of like comparing the ripe, perfectly yellow banana with a brown, spotty one.

I think what you've found is that some tenants in the C hoods actually can and will pay for a decent house. You've switched your target market to the cream of the Class C crop rather than settling for those who are struggling and always 1 step ahead of a bad eviction. That's good news: because if you did it once, you can do it again. It's not just a fluke. The secret sauce is Roy's new marketing, not a lucky break.

Go for it again!

Hello to my good friend Sid,

15 years ago, my average rents were around $550.00. Over the years, if I had never raised my rents, I would still have average rents of $550.00. Now my average rents are in the $850 range and that is due to always trying to find the top of the Class C rental market instead of settling for the riff-raff at the bottom of the market. Since renting my first house in 2005, I have always been the highest paid LL on any block where I have a rental house. I take pride in that. It makes me feel good.

Right now, my future goal is get my average rents up to 4 digits at $1,000. So far, I have done this with 3 of my rental houses, but now I am trying to bring a few more rental houses into the 4 digit arena.

Roy, that's another fine looking place.

mapleaf18, that's a nice looking place as well.

Do you ever have problems with the pocket doors?

I had one place with those installed but I pulled them before I rented the place. They led into a bedroom and took up way too much wall space.

I had two of my nicest properties come available at the same time, one was much larger with granite countertops, custom cabinets, freshly renovated, with a large floor plan. The other was slightly smaller but equally nice. As an experiment I priced the larger $100 over market value and the smaller $100 under market value. I’m usually flooded with inquiries on the larger one but I barely got any interest at all on it this time around. I received a lot more interest on the smaller one, but still much less than usual. People just aren’t moving right now unless they’re being forced through circumstance or work.

Zero,

Roy,

We LLs must realize not everyone is a cheapska....THRIFTY like us! LLs will drive across town to save 26 cents on cottage cheese.

PRICE is only one reason people make choices. Great online (staged!) pics, good marketing, good service to prospects, smooth application process, convenient location, personal preference....

Your yellow home reminded me we just rented a yellow home to a lady with a yellow car. She joyfully exclaimed "I just love anything yellow! Where do I sign?!"

Her goal was retire and move to this town to be closer to relatives, cousins, aunts, uncles...other homes were available but she chose mine because it was YELLOW.

I don't mind paying more to drive a Porsche because the extra investment gives me things I want, like personal satisfaction, driving a piece of engineering excellence, wind in my hair...and thumbs up from 13 year olds at stop lights:)

Roy,

We LLs must realize not everyone is a cheapska....THRIFTY like us! LLs will drive across town to save 26 cents on cottage cheese.

PRICE is only one reason people make choices. Great online (staged!) pics, good marketing, good service to prospects, smooth application process, convenient location, personal preference....

Your yellow home reminded me we just rented a yellow home to a lady with a yellow car. She joyfully exclaimed "I just love anything yellow! Where do I sign?!"

Her goal was retire and move to this town to be closer to relatives, cousins, aunts, uncles...other homes were available but she chose mine because it was YELLOW.

I don't mind paying more to drive a Porsche because the extra investment gives me things I want, like personal satisfaction, driving a piece of engineering excellence, wind in my hair...and thumbs up from 13 year olds at stop lights:)

SO...Price it a little high while giving them more than other LLs.

Echoing Brad, I learned a bit here doing more effective marketing to sell a place versus what I was doing to rent. I had professional photos taken to sell and that was very effective in that effort.

I've resolved to step up my game by doing the same with all rentals. No more cell phone pictures. Also, I think Roy raises a good point about raising the rent. I'm going to try this, however, that only works with a stepped up game in other areas (i.e. prepping the property to make it the best in class and etc.)

Roy, my pocket door thought was about mapleaf18's place. I looked at hers after I looked at yours.

Both places look nice to me.

Roy,

I snagged 2 pics from your Zillow ad and sent them to VSHmedia for staging. I emailed them to you.

Copy them and post them on your ad and you'll see how they make your home look more valuable than current pics.

They look FANTASTIC!

(Empty rooms look like lonely orphans)

PS

the stager will add a watermark but I could not remember your business's name.

PS

I find a row of black mulch around the foundation and few evergreen bushes makes a home look much more "comfortable" and

"upscale" for more rent.

$100 in mulch and bushes can set you apart from the competition.

PS my professional designer says NEVER use red mulch. It distracts the eye from the home and does not match the home.

Brad20K,

Roy,

I sent them from LeaseDesk on May 30.

I resent them just now from gmoffice in an easier format.

BRAD

PS remove half the stuff in the bathroom. No shaving cream etc. MOMMA buys the house and she want a fresh flower and SPACE for her cosmetics. I thought the bathroom was in use.

BRAD

The question in my mind right now is, how did Brad snag 2 of Roy's pictures and then change them?

Brad20K,