3 Steps for Setting Rent Rolls for Lease-Ups

3 Steps for Setting Rent Rolls for Lease-Ups

Crafting a rent roll for a new development lease-up not only attracts the residents but establishes market-leading rents and an accelerated path to stabilization. Creating rent rolls can be complex, so here are three key steps to ensure yours is both profitable and appealing to potential renters.

1. Analyze Competitor Prices

Just like in any business, renters have options. When searching for a new apartment, renters will always check out other properties, so knowing your competitors' rental rates is key. Before finalizing your rent prices, check out what similar properties offer in terms of amenities and units. It's crucial to assess neighboring buildings and understand how renters perceive value - and what rent they're willing to pay.

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Beyond comparing buildings, consider the market conditions at your lease-up time. In Boston, rents are steadily rising year after year, with a dip in demand during winter and a surge from June to September. Monitoring the market can give insights into your competitors' pricing, helping you gauge if your rates will remain competitive when your residents move in.

2. Review Unit Types

In a multifamily building, you'll come across various types of units like studios, one-bedroom, two-bedroom, and more. These units can be quite diverse or similar. But here's the thing - different unit types attract different levels of interest and demand and can vary greatly depending on the market. 

And get this, even within the same type of unit, different layouts and features can sway desirability. Take open-concept layouts, for instance; they have been a recent trend, making people more willing to pay a premium for those units. It's all about knowing what your target market prefers to set the right rents based on demand.

3. Forecast Unit Desirability

Premium units are identified as the most desirable units at the property - the ones renters see as extra special and are happy to pay a bit more for. Things like top floors, great views, or extra perks can often add rental value.

Pricing premium units higher than standard units can capture additional revenue and increase your overall profitability.  Similarly, recognizing the units that may be less desirable is equally important. It's crucial to conduct thorough market research to understand the preferences of potential residents and pinpoint the features they deem premium, as well as less desirable. Carefully assessing this contrast enables you to strategically price premium and less desirable units, ultimately balancing your rent roll for profitability.

Final Thoughts

By engaging in close collaboration with a seasoned team specializing in new development lease-ups, developers and investors have the opportunity to greatly amplify the effectiveness of a lease-up process. This partnership can lead to the establishment of market-leading rental rates, paving the way for a swifter journey toward stabilization and ensuring a competitive edge in the market. Contact CHARLESGATE to see how your new development project can lease up faster while hitting above-market returns on your investment.

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