You have a multi-family property, and it’s doing pretty well, but you want to see if it could be doing better. How do you go about doing so? By performing a rent survey. If your property’s rents are priced under or above the average market rate, you may not be maximizing your investment to the best of it’s availability.
What Rent Surveys Illustrate
Market surveys show if you’re charging enough or too little, amenities that could enable you to raise rents, and the strengths and weaknesses of competitors. It also points out your own property’s gains and losses and how to plan for the future of your rental rates.
Essentially, a market rent survey helps property owners and landlords understand the rental rates that are being met in a certain area by investment properties. The survey contains a chart of comparable properties, their rental rates, and occupancy by rental rate per unit type. It also holds your property up to others and compares square footage, age and condition, and available amenities.
How to Conduct a Rent Survey
To create a rent survey, you’ll need a spreadsheet or chart. Microsoft Excel is great, but Google Sheets can also be used if you want something more accessible or do not possess Excel. You’ll start by creating columns and headers for every category you’d like to compare. At a minimum, your chart should contain:
- Property Name
- Phone Number
- Unit Size
- Unit Type
- Rent per Square Foot
- Year Built
- Occupancy at Minimum
Other categories could include amenities offered, the condition of the property, the average tenure of tenant, and/or pet policies.
Gather a list of your competitors by searching local listings or canvassing the area. Once you’re satisfied with your list, begin collecting data. The best way to go about sourcing information is to read through a property’s associated website. If no website is available, you can call them, analyze their marketing materials, or visit their leasing office. If you have friends who are realtors, you can tap them for possible information. Occasionally, you’ll be able to glean information about properties through their tax records.
Once you have all the necessary information filled out on your chart, you can start to analyze and compare the data collected. Pay special attention rental rates. Calculate the average rental per square foot and unit type. Then, compare it to your own and see how it lines up.
Rent surveys offer an in-depth look at how well you’re maximizing your investment and can illuminate the long-term success of the property. Such surveys can also be used to determine if a property you’re interested in buying will be a good investment. Be sure to update them over time as new competitors crop up or fall away and you’ll be able to see market trends and stay one step ahead of them.