We see them all the time houses for rent 2, 3, 4 and 5 months and sometimes even longer. Some landlords are holding out for the "big bucks".  I have heard the same thing on many occasions, oh,"I've got to have 'x' amount of money per month to rent this place. I'm looking for the big bucks." 

I think that depending on the individual situation, sometimes this thinking can be a little short sighted in the current market we are in. In our area of Brevard County Florida vacancies are up this year by over 12%, to a total of about 15%.

There are some competitively priced properties for rent.  Not to mention apartment buildings that are offering low and no security deposits.  And a free month's rent (typically given at the end of the lease term).

If a house is listed for rent at $1200 a month and it takes the owner 4 months to get a tenant, the landlord/owner has just lost $4,800 to earn his $14,400 for the year.  So, his rent would be $9600.*

Take the same rental and charge $900. Typically (mind you, I said typically), because it is more affordable, it will rent more quickly.  Let's say it takes just one month for a tenant to move in.  You have lost $900 to get that $10,800.  (of course, we are assuming that the house in is good condtion for a new tenant to move in).  In this situation his rent would be $9900.*

In my opinion it is always better to get a tenant in sooner, rather than later, provided you have picked a well qualified tenant that suits your screening criteria, and you have not forfeited your good judgement in putting that tenant in TOO quickly.

The house is not sitting empty for several months time.  This is a concern today, as we are hearing about more situations where theives are entering vacant houses at night stealing a/c units, appliances, cabinets, flooring and even stripping the copper wiring out of the walls.

Remember, some insurance companies will not cover rentals that are vacant for over a period of 30 days.

So, consider carefully when pricing your rental to put it on the market. Make sure that your rent is in line or  below market rent for your area. Nothing wrong with making your rental a good deal.

Over the past 13 years in being a landlord I have found that tenants stay longer if the rent is affordable and in line or a hair below market rent.  Don't get me wrong, as the market headed up my rents went up by $25 to $50 per month, each year.  I have had tenants that have stayed with me for 5 years and a couple that are going on 8 to 10 years. 

If you make the rent too high, tenants are going to move. They will move to save several hundred dollars a month.  For me, I have seen that often times the higher the rent amount the shorter the term of the tenant.

VACANCIES CAN EAT AWAY AT YOUR CASH FLOW.  NOT TO MENTION,WHEN THE TENANT MOVES THERE ARE ALWAYS FIX UP EXPENSES AND REPAIRS COSTS WHICH CREATE MORE DOWN TIME.

*I have tried to keep this as simple as possible, as I used these figurse for illustation purposes only.  I understand that landlords/owners must pay their mortgage payments, taxes, insurance, assessments, repairs, maintenance, etc out of these monies.

In this post I am stating my opinions from my experiences in being a landlord/owner in Brevard County Florida.  Your experiences in a different part of the country may vary.

This article is authored by Sandy Shores, Melbourne FL REALTOR.

South Brevard County, Florida Space Coast.