Rent Price Decreases, Is everyone doing this? Options

[lwelke]

I guess I just have to look at the rental websites (i.e. Rent Faster) and talk to potential renters to learn that rental prices are decreasing. Just want to hear it from my fellow members to see if they are decreasing their rents as well and if so, by how much (i.e are you using a percentage, or just going by what the market is telling us to do)?

Thanks.

Leanne Welke

[MonteDobson]

Please provide more details. What area and rental type are you talking about?

In many areas rents are going up, not down!

[LeighF]

Please provide more details. What area and rental type are you talking about?

In many areas rents are going up, not down!

What areas are going up? I have 2 condos in NE Edmonton and have decreased both to $1295 month versus $1350 to get people in there

[lwelke]

My property is in Capitol Hill in Calgary, a 2 bed, 1 bath, 820 sf home. New laminate flooring, linoleum, paint, fridge only six mos. ago. Excellent condition interior, exterior of house needs paint. Street parking. Shared laundry. Rented for $1350 plus 2/3 utilities in May, now prices in the area for similar home seem to have dropped to approx $1200 and less.

[RebeccaBryan]

Remember that story that we were given in REIN about the father with the hot dog business and his son came home and told his father that the economy was in bad shape or something to that effect so the father listened to his son and ended up going out of business.

Well, I heard rents were going down, so, I bought into it for a bit, and actually had one of my places vacant for a couple of months. Then, I decided to pump up my advertising and put more adds online with great pics. Then I went put signs on the streets in as many places as I thought necessary to get lots of calls and guess what? Well, I got the places rented out for what I was asking, without lowering them, except 1, which I only lowered $50/mo. and that's if he agreed to take the basement suite of the duplex as well for his workers.

Just pump up your advertising!!!! Put some effort into marketing and you will get the places rented for what you want!!

Don't buy into the doom and gloom!

This post has been edited by RebeccaBryan: Nov 9 2008, 02:35 PM

[EdRenkema]

Remember that story that we were given in REIN about the father with the hot dog business and his son came home and told his father that the economy was in bad shape or something to that effect so the father listened to his son and ended up going out of business.

Well, I heard rents were going down, so, I bought into it for a bit, and actually had one of my places vacant for a couple of months. Then, I decided to pump up my advertising and put more adds online with great pics. Then I went put signs on the streets in as many places as I thought necessary to get lots of calls and guess what? Well, I got the places rented out for what I was asking, without lowering them, except 1, which I only lowered $50/mo. and that's if he agreed to take the basement suite of the duplex as well for his workers.

Just pump up your advertising!!!! Put some effort into marketing and you will get the places rented for what you want!!

Don't buy into the doom and gloom!

Well I'm not buying into the doom and gloom but I'm having a lot of trouble getting any action on my third purchase since joining REIN. It is totally renovated, I've advertised since last week of September, now on 3 sites: kijiji, gottarent, craigslist, was on viewit.ca and my realtor listed it on Royal Lepage. I'm $25 below market rent (I've got another in the same complex) I'm offering a $100 Xmas gift certificate and a free DVD player with one year lease. Last week I walked the neighbourhood and put out 150 flyers offering $100 to anyone who brings me a tenant that leases for 1 yr. One call this week, one call last week - just tire kickers, here is the kijiji ad:
http://hamilton.kijiji.ca/c-ViewAd?AdId=86...70-0e80ffff794b
What else can I do?
Any suggestions?

[RedlineBrett]

First off, remember that this is a difficult time to rent. Q4 is always the toughest!

I would take some better pictures - there must be a better way to capture what the kitchen looks like. Also, no pics in there of the bedrooms, or anything showing what the street or backyard is like - you need to get some of these in there. The family room also looks very dark with that floor so you may want to put a light in the corner for your pictures.

Buyers/Tenants will browse based on your first photo and if they like it they'll read the add - so get a good one of the kitchen or family room or whatever is the most attractive room in the property.

I would also move the talk of the incentives to the bottom of the add as a 'closer'. As soon as someone opens up the add they are looking for three things - rent\utilities amounts, beds + baths and more information about the location. Make this easy for them to find and then hook them with the extras you are offering at the bottom.

$0.02

Well I'm not buying into the doom and gloom but I'm having a lot of trouble getting any action on my third purchase since joining REIN. It is totally renovated, I've advertised since last week of September, now on 3 sites: kijiji, gottarent, craigslist, was on viewit.ca and my realtor listed it on Royal Lepage. I'm $25 below market rent (I've got another in the same complex) I'm offering a $100 Xmas gift certificate and a free DVD player with one year lease. Last week I walked the neighbourhood and put out 150 flyers offering $100 to anyone who brings me a tenant that leases for 1 yr. One call this week, one call last week - just tire kickers, here is the kijiji ad:
http://hamilton.kijiji.ca/c-ViewAd?AdId=86...70-0e80ffff794b
What else can I do?
Any suggestions?

[RebeccaBryan]

OK this is what I do and it has worked well lately. I still have 1 more place to rent out of a recent 4 vacancies.

I have found that the websites haven't brought me any calls or even inquiries dispite my good ads and great pictures, so I decided something else needed to be done about it. I posted signs in the yards of all of my rental properties, even the ones that were already rented. I let the tenants know what I was doing so that they didn't wonder what was going on. (All properties are in close prox. to each other) Then I posted signs on the main streets. Then I used a phone message on my home phone that outlines what I have for rent. I had 4 properties at the start so I just had a message stating that I had 2, 3, 4, and 5 bedroom suites for rent and my cell phone # to call if they wanted more information. I would be out and about and my cell phone was ringing off the hook!!! I had a lot of tire kickers, but I got the calls I needed and the rents I was looking for. I have just one left, and I'm toying with the idea of lowering the rent, but not after some last stitch efforts to put up better signs in different places. All I have is "for rent" and the number on the signs.

Yes, you are not supposed to put up signs on the boulevards here in Edmonton, but I have found that the city has been leaving them alone, where as a few months ago, the moment you put them up they would disappear and it would be a wasted effort. Maybe they found it to hard to police.

"note" You will get many calls from this method and if the calls quit coming in, you know your signs must be missing so go and check and make sure they are visible!!

This post has been edited by RebeccaBryan: Nov 9 2008, 04:41 PM

[RebeccaBryan]

One more thing to add. I buy my signs at Staples, not because they are cheap, but because they are two sided and that's important.

[MichaelBradfield]

Hi Rebecca:
Re signs at Staples: How big are they, and do they come with stakes to stick them in the ground?
Are the signs foam core?
Thanks
Mike Bradfield
Calgary

[Nicola]

OK this is what I do and it has worked well lately. I still have 1 more place to rent out of a recent 4 vacancies.

I have found that the websites haven't brought me any calls or even inquiries dispite my good ads and great pictures, so I decided something else needed to be done about it. I posted signs in the yards of all of my rental properties, even the ones that were already rented. I let the tenants know what I was doing so that they didn't wonder what was going on. (All properties are in close prox. to each other) Then I posted signs on the main streets. Then I used a phone message on my home phone that outlines what I have for rent. I had 4 properties at the start so I just had a message stating that I had 2, 3, 4, and 5 bedroom suites for rent and my cell phone # to call if they wanted more information. I would be out and about and my cell phone was ringing off the hook!!! I had a lot of tire kickers, but I got the calls I needed and the rents I was looking for. I have just one left, and I'm toying with the idea of lowering the rent, but not after some last stitch efforts to put up better signs in different places. All I have is "for rent" and the number on the signs.

Yes, you are not supposed to put up signs on the boulevards here in Edmonton, but I have found that the city has been leaving them alone, where as a few months ago, the moment you put them up they would disappear and it would be a wasted effort. Maybe they found it to hard to police.

"note" You will get many calls from this method and if the calls quit coming in, you know your signs must be missing so go and check and make sure they are visible!!

Great ideas, Rebecca.
Does anyone have property managers that are willing to go this extra step? Is it a reasonable request to ask a PM to do this?

[VicChung]

Hi Rebecca:
Re signs at Staples: How big are they, and do they come with stakes to stick them in the ground?
Are the signs foam core?
Thanks
Mike Bradfield
Calgary

I remember being in the same situation last year. November, December are traditionally slower months for rental. It took me about 3 weeks to rent my property at $1499, above the market rent which was $1200. It all depends on your advertising (online, window signs, lawn signs, newspaper, community center) and your product (i.e., location, number of rooms, renovations and so forth). Also, I have a reality check every week. If I have been getting calls, it is normally a good sign. If not, then I bring down the price by $35-50.

On a similar note, I rented a 3-bedroom basement unit for $1649/month this year which is really amazing when most basement units will probably go lower.

I found that the quality of the tenants is much better when the rent is higher as well.

[EdRenkema]

Thank you Rebecca and Brett! I will impement these changes when and where possible.

[MikeMcCrae]

I have always found Nov Dec and Januarary to be a bit difficult except in 06 and 07. I have my first vacancy in 9 years this month but it looks like I will have some one moving in in the next day or two inspite of a $200.00 per month increase and not giveing them the garage. More creativity may be required to find tenants right now but be careful about buying in to a trend that effects your profitability. People only think they buy price.

[ThomasBeyer]

...

Just pump up your advertising!!!! Put some effort into marketing and you will get the places rented for what you want!!

Don't buy into the doom and gloom!

not quite so rosy .. there are layoffs in Alberta .. gas price is very low .. hence drilling is low .. oil prices are down .. oilsands projects are being canceled .. less homes built thus less furniture bought .. so while Alberta overall will do MUCH BETTER than the rest of Canada or US .. it will get higher unemployment too !

So set realistic rents .. and that may include rent decreases or rent incentives ..

Here's my rough guideline for Edmonton, for an "average" unit:

1BR $800
2BR $1000
3BR $1150

plus or minus 25% for: location, view, size, upgrades, distance to buses/LRT ..