Whenever I list one of my homes for rent, I know the following day is going to be filled with phone calls. For the most recent rental listing of one of my better single-family homes, I got the first inquiry call literally within 1 hour of posting it to Zillow; and the next day, just as expected - was filled with calls, emails and texts from people seeking to rent that house. Now your market may be different than mine here in Durham, North Carolina - but there are things you can do just about anywhere, to make your rental home stand out from the crowd.
Advertising your rental vacancy is a critical element of my show from last week (Ep. #8 | Don't Let Vacancy Kill Your Rental Cashflow) - but here in this episode, I'll go into further detail specific to advertising and making your rental home stand out in a crowded rental market. Today's quote..
“The world accommodates you for fitting in, but only rewards you for standing out.” ― Matshona Dhliwayo
Welcome to Episode #9 - Rental Property Advertising - How To Make Your Rental Home Stand Out From The Crowd.
Would you consider the location of your rental property to be a "crowded rental market" (as I do air quotes)? Are there lots of homes for rent with many having been listed for weeks or even months? I advertise my rentals in many ways and on many sites, that I'll go into later in this episode, but with one possible exception - I get the greatest response from Zillow, and the sites that Zillow syndicates to, like Trulia and HotPads. So let's run a quick test on Zillow to see how much competition your rental market has. And as it would happen, this process is also the start of my market research that helps not only to indicate how I should advertise a given rental to make it stand out, but also what the target rent should be.
First, go to Zillow.com and enter your city and state, which for me is Durham, North Carolina. Click the link for [Rent] and then adjust the search results to show all home types for rent in your city (except for Apartments, so show only Houses, Condos & Townhouses) at any rent and any bedroom count. How many such properties are for rent in your city right now? For me in Durham it is 280, but before I excluded Apartments, it was 1,638. Then adjust the sort order for [Rent] "(Low to High) & "(High to Low)" to see what the lowest and highest rents for homes are on Zillow in your market at this time.
At the time of this recording, on Zillow for Durham (excluding Apartments) the lowest rent is $750/mo for a 1BR; and the highest is $3,900/mo for a 4BR House @ 2,865 SqFt. Now if I had not excluded Apartments, the lowest would have been around $500/mo (sometimes even lower) and the highest would have been well over $4,100/mo for some of the newer Downtown Durham "Luxury" Apartments (as I again do air quotes).
Now anything for rent in my city is technically my competition; however, my properties tend to rent from $900/mo to $1,600/mo (for the most part), so let's add Apartments back into the search and then set your ideal rent range. Also, I don't have any 1 Bedrooms - I'm going to set my search results to 2+ BR, you set whatever bedroom count relates best to your situation. Now with those settings for me, Durham returns 544 results. Is that more or less than your city once you adjust the search to fit your typical rent range and bedroom count?
These 544 are my competition in the City, and if I remove Apartments from the results, it drops to 120. But I leave Apartments in because I want to consider everything that is available for rent in the city within my rent range and at my bedroom count. Also, lots of really nice Duplex, Triplex or Quad Units are entered as Apartments, and so I don't want to exclude these. I also know that my Single-Family Houses, Townhouses and side-by-side Duplexes have an advantage of desirability over anything where you have to climb steps to get into the home; or where there's another family living above and thus walking on the ceiling of the home. ALL People prefer Single-Family Houses, Townhouses and Townhouse-style (side-by-side) Duplexes to Apartments any day - but I must still account for them in my analysis.
So now let's size up the competition...
Browse the pictures that you see for the Zillow search results in your City. Again, for me I'm working with 544 results - but I will shortly narrow this further. Your likely to see a mix of exterior pictures and kitchens with the occasional living-room picture thrown in. For those with a main picture being of the interior, most will be furnished or staged. It will be pretty obvious which are using professional photography and which are using cell phone pictures, but some even with pictures taken on a phone will be decent. But the vast majority of the pictures will be of a lessor quality. In fact, some will be so bad, that if you also have a Property Management business like I do, you should note those addresses to contact the owners and pitch your professional services - they need it.
If your rental home falls within the search criteria a person is seeking (i.e. location, bedroom count / size and rent), then from that point - PICTURES MATTER more than anything else. And the most important pictures are exterior and kitchen. I'll also include living-room, but preferably where it also shows the kitchen, along with nice flooring and lots of space. Whether leading with an exterior or kitchen picture depends on which is the most eye-catching and noticeably different (hopefully also better) than your competition.
For the rental house I spoke about at the opening, I went with an exterior picture, but it was one taken at night with every inside and outside light on. It's a beautiful picture of the home that absolutely demands to be clicked to see the inside - especially when listed at only $1,512/mo for a 4BR house @ 2,097 SqFt. That picture makes the listing stand out; and the next 2 pictures (which Zillow also highlights) is of the community sign and the kitchen viewed from across the living room. If they are seeking a 4BR in this rent range, the prospective tenant cannot help but to click further to see the other pictures, of which I provided 57 - positioned and ordered so as to take the person on a virtual step-by-step tour of the house.
When done viewing these pictures, the person cannot help but to feel they know the house and whether or not it will work for their needs. Most people request an in-person showing anyway, but that's because in part, it all looks too good to believe at the stated rent. Now I'm pretty good with cell phone pictures. I watch YouTube videos on getting professional quality photo results with a SmartPhone, and I use a Samsung Galaxy Note 9, which is known in part for its excellent camera. I'll also likely take a course at the local Durham Tech College on Cell Phone Photography later in the year. But if you are not as good with cell phone pics, or don't have the correct phone for doing so, then hire a pro - it's not as expensive as you might think.
Can you upgrade your rental home?
What also is not as expensive as you think is making certain upgrades to your rental house. In a rental market of basic white appliances, how much more will stainless steel appliances make your rental stand out from the crowd? Often, stainless steel appliances are not much more expensive than basic white - but they can make your rental 10 times more appealing.
If you buy distress homes to rehab into rentals as I do, then these upgrades are logical inclusions to the original rehab budget. But if not, the next time you need new kitchen counters in your rental, considering going ahead and upgrading to granite. And the next time you need new carpet, why not just replace it all with vinyl plank flooring? Have you ever considered resurfacing kitchen cabinets to white or gray; adding stainless steel cabinet door handles; better kitchen sink faucet; upgraded light fixtures and fans; improved vanities in the bathrooms, and such?
Not only do upgrades like these make your rental home look much better (making your rental more appealing and thereby able to command a higher rent), but upgrades like granite counters and vinyl plank flooring are much more durable, making your tenant turnover far less costly. These upgrades can also increase the value of your home - beyond their cost in many cases. So unless just completely out of place for your area and rental range, these upgrades are a worth while consideration and make for great pictures. And the pictures are everything on a rental listing.
It laughable when looking at rental ads on Zillow, seeing just how many poor quality photos are posted. How many homes are lacking desirable upgrades. And then even how few photos most listings have. But hey... That's good for me, as it makes my listings stand out all the more. And it makes my Property Management clients love me and how well I market their rentals . So another quote from (and hopefully I'm pronouncing the name correctly)...
Matshona Dhliwayo ― “A pink rose among a thousand white daisies stands out; be likewise.”
Now let's see if we've set the correct rent...
Let's narrow our Zillow search criteria a bit more to find the best rental rate. If you've not already done so, change the bedroom count to match your rental home exactly. Then set a minimum square footage that is slightly less than your home, and observe the results. For me, after I set 4 bedrooms of at least 2,000 SqFt, the results went down to 1, that was slightly bigger and newer than my home at $1,550/mo. Since 1 is not a good sample size, I needed to make some adjustments, so I reduced the minimum square footage to 1,800 - and the results increased to 4 that were priced from $1,560/mo to $1,600mo.
I then entered the specific address of my house, instead of searching all of Durham; and I backed off the criteria (removing the price limits, lowering the square footage) and zoomed out on the map, until I started getting results. But the results I got were not in my same neighborhood. In fact, they were in slightly better neighborhoods (judging only by average house price / value and age), and despite being smaller than mine, they were actually listed for slightly more than I was targeting. Now on the other hand, they had also been listed for rent for several weeks - for example, one at $1,595/mo had been listed for 45 days. I don't want my listings sitting for 45 days while I suffer vacancy loss! As I mentioned in last week's episode, you are likely better off lowering your rent by even as much as $100/mo - if it allows you to avoid a month or two of vacancy.
Now Zillow has their "Rent Zestimate", so I consulted this, along with Rentometer - which showed an average rent for a 4BR in this area of $1,419/mo and a median rent of $1,475/mo. I also did research on CraigsList.com and several other rental listing sites. Now my rental house is of a little better quality than many in the area, but I also like to remain slightly below market rent - to lessen vacancy and encourage long-term tenants. This all suggested that I can successfully list the house for rent at $1,525/mo; however, I instead lowered this and listed at $1,512/mo, for one reason - Section 8.
Should You Consider Accepting Section 8?
In my City of Durham, North Carolina - Section 8 (called the Housing Choice Voucher Program) pays market rents, and sometimes ABOVE market rents. Exactly 1 less than half my homes are rented to tenants who have Housing Choice Vouchers; and I look to make as many of my rentals as possible available to those who are on Section 8.
So in the case of this most recent of my rental listings, I deliberately set the rent ask at $1,512 instead of $1,525/mo - because $1,512 is the maximum Durham Housing Authority will pay for a 4 bedroom under the Section 8 (Housing Choice Voucher) program. Thus, by setting this rent, I open my rental listing up to all those in Durham with Section 8 vouchers. I can then list the house on GoSection8.com - which is the only website that I've found to occasionally generate even more inquiries than Zillow.
Now I know that most Landlords gasp and recoil at even hearing the suggestion of making their rental home available to Section 8. Unfortunately, Section 8 has opinions on both sides of the spectrum among Landlords. Some hate even the idea of the program, considering it a government handout, and where not mandated by law, refuse to participant in the program under any circumstances.
That's unfortunate, and too bad for those Landlords - But other Landlords (like myself), participate willingly in the program, as I said - making most of my rentals available to those with Section 8 vouchers. But there's no denying that Section 8, while having some benefits over non-subsidized tenants, also has some additional risks that must be fully understood and considered before going the Section 8 route - which I'll detail for you in an episode specially about Section 8. And I'll also admit that in certain locations the Section 8 program is not run effectively; and I would stay away from it in those location like the plague. But thankfully for me - Durham, North Carolina (Durham Housing Authority) actually manages the program well.
But now let's go with some stats... I contacted the Director of Durham Housing Authority's - Housing Choice Voucher Program. And she related to me that there are currently 2,742 participants on the HCV program. Approximately 65 families with vouchers are currently searching for housing in Durham. And approximately 1,500 applicants are on the current waiting list - just to get a voucher to then begin their housing search.
So if you open your rental house in Durham to those with Section 8 vouchers, you not only potentially get the interest of those 65 families now searching (who only have 90 to 120 days to find a home); but you may also get the attention of those 2,742 participants, a large number of whom are constantly seeking to improve their current home - that they likely selected out of desperation before their 90 to 120 days expired when they first received their voucher.
As stated, listing my rentals on GoSection8.com often gets more inquiries than does Zillow, because so few landlords are willing to participate in the program (and even less with nice homes) - that it makes my properties stand out like that pink rose among a thousand white daises.
So when setting my rental rates, I consider what is the maximum that Durham Housing Authority will pay for X number of bedrooms under its HCV / Section 8 program. In my city you can find this by searching Google for keywords like "Durham HCV Payment Standard" - and it will take you to a page that has a link to the Payment Standard PDF at the bottom. My rentals are 2, 3 & 4BR - of which Durham pays up to: $990; $1,356 and $1,512 in rent for these - respectively.
So lowering the rent ask on my latest listing by $13/mo from $1,525 to $1,512 - may end up costing me $156 for the year. But I consider that more than a reasonable concession to have potentially thousands more people seeking my property. And even if someone with a voucher doesn't get this specific property, it puts me and Blue Chariot Properties or Blue Chariot Management on their radar and it gets them on my rental vacancy notification list - so they may get the next one.
I'll go into the many benefits of accepting Section 8 in your rentals in another episode, as well as some of the risks that must be considered. But when combined with effective tenant screening, scheduled inspections and consistent policies, accepting Section 8 can make vacancy a thing of the past - while pulling in ABOVE market rent for your rental from a tenant who is likely to remain for many years to come.
OK so, a picture is worth a thousands words, right... But you do need the words...
Now how do you describe your rental listings? Don't just state a bunch of facts and figures, like "This house has 4BR/3BA at 2,097 SqFt for $1,512/mo"... Tell a Story! "Welcome Home to your 4BR House in the quiet Greenwood subdivision of Durham off Tyne Drive. In addition to 4 bedrooms, your next home features 3 full bathrooms across 2,097 SqFt of space - which does not include the 2-car garage and large raised deck in the wide-open back yard for barbecuing." - now of course I could go on, but I think you see the picture I'm trying to paint with words.
And if I did continue, I would go on to mention the skylights, large windows in every room, plantation style blinds, stainless steel appliances, fans in all bedrooms and living areas, large walk-in and whole-wall closets, washer / dryer hookups, security system, and on, and on.
Your description should make people want to see this house, even if it had no pictures. But when combined with your enticing pictures, it should make them want to apply immediately. Because it should be more than clear, that this home will not be available for long - so they should not waste time, because this house will go to whomever acts with the greatest urgency.
I often have people apply for my homes prior to even having a showing, so who my homes won't likely go to is the people who want to measure the rooms to see if their bed will fit (like they can't get a different bed). But for those people I even try to include the bedroom measurements right there within my listing. I don't want any excuses, nor do I want to waste my time showing the home to someone only for them to remark "the bedrooms are too small" (as I again use air quotes).
So to conclude...
Now you've got your rental listed with like 50+ pictures creating a virtual walk-thru of the home; and your main picture is an amazing shot of the exterior or kitchen (or maybe the kitchen shown from the living-room across a wide open space featuring nice flooring). Your description text paints an equally impressive picture that compels people to move with a sense of urgency - giving them all the details as needed to make a decision as to just how much they already love this home.
And you didn't just list your rental on Zillow and its syndication partners of Trulia and HotPads, but you also considered accepting and posting on GoSection8.com. And I've not mentioned it before now, but sites like Cozy.co, not only allow prospective tenants to apply for your listing (running credit and background checks); and to pay their rent online. But Cozy also syndicates your rental listing to additional sites, like Doorsteps.com and Realtor.com. There are also many other sites that you should consider listing to, including CraigsList.com. There is no such thing as listing your rental on too many sites.
And of course if permitted and effective for your location, you can also place a "For Rent" sign out in front. I don't do this personally any longer, as online advertising has been so effective for me - plus I have a number of homes under an HOA that would not allow signs. But I'll do a coming episode on handling rental inquiries with details on how to automate much of this work.
And where it makes sense to do so, you have your rent ask set competitively, possibly even slightly below market. And if you're willing to consider it, you've set your rent ask within the range of what Section 8 will pay for a rental in your City for the number of bedrooms. When posting a rental listing at a competitive rent that features amazing pictures with a compelling write-up - your rental will shine among the competition like the house on the cover image for this episode.
So I'll close this episode out by completing the prior quote by...
Matshona Dhliwayo ― “In a world full of daisies dare to be a rose.”
And this doesn't just apply to your rentals - it applies most of all to yourself. Be the rose in all things!
This (9th) Episode of the [... and Landlord] Rental Real Estate Investing Podcast is titled "Rental Property Advertising - How To Make Your Rental Home Stand Out From The Crowd". As is indicative from the title, the episode delves mainly into Property Advertisement.
So in this episode, I go into things such as posting enticing pictures (lots of them), and making sure that your main exterior and kitchen (or kitchen and living-room) pictures are amazing. These can be taken with a SmartPhone, but you need to know what you're doing and have proper lighting - otherwise, go pro and just pay to have it done right. You can stage the home with some furniture and decor, or showcase your wide-open space - but the pictures have got to be on point.
I continue to say a word on your words... Yes, a picture is worth a thousand, but you still need some words, and they need to paint a compelling picture. So I give an example of how to tell a story with your listing text, instead of just citing bland facts and figures - like all the other rental listings on Zillow and other sites.
And I mention Zillow, Trulia, HotPads, CraigsList, Realtor.com - and other sites, including GoSection8.com. Have you considered Section 8? In this Episode I go into a bit of detail as to why you should, including some stats on the program for Durham County, NC. But I don't tell the full story on Section 8 here (only how it relates to making your rental listing stand out from the crowd) - so in a coming Episode, I will go into more detail on the pros and cons of making your rental homes available for persons with Section 8 vouchers and the process for doing so.
I also provide an example of how to conduct market research on Zillow to learn what the competition is like in your area. And how to use the information presented on Zillow to identify how best to stand out among others listed. And even what your target rent should be as suggested by Zillow, CraigsList and Rentometer.com - but possibly adjusted to target Section 8.
Upgrades? Lastly, I speak on how you can make your rental home stand out from the crowd by making upgrades. Why have fermica or "hard surface" counters when you can have granite? Why carpet when it can be "luxury" vinyl plank? Why have white appliances when they can be stainless steel for not much more? Why not add fans in the bedrooms and living areas, upgrade light fixtures, add a backslash in the kitchen, tile the shower, etc...? Make the home beautiful while also hardening it against tenants.
If you can make people say "WOW!" when they see your listing, and feel a sense of disbelief that it is available within their rent range... You'll get the best tenants; who'll remain for years; while gladly accepting annual rent increases; and having pride in the home - of which they take great care.
This 9th Episode ("Rental Property Advertising - How To Make Your Rental Home Stand Out From The Crowd") is a deep(er) dive into the rental advertising aspects of last week's: Ep. #8 | Don't Let Vacancy Kill Your Rental Cashflow.
So as mentioned in Episode #8, your rental listing advertising is a critical element of keeping vacancy to a minimum. Now learn how to make your rental home stand out from the crowd, like your house has a spotlight shinning on it from above.
P.S. Sorry, but two rental advertising or promotion methods NOT mentioned in this Podcast episode (but highly valuable) are Social Media and YouTube...
Social Media: Zillow, Cozy and pretty much every site where you can (and should) list your rental, also include the ability to share your listing on just about every Social Media site. And when posting to places like Facebook, don't forget to share your post to related local groups.
YouTube: Zillow, Cozy and others also allow you to feature a video of the home. So you should shoot a video walk-thru that you post to YouTube, and then link to the posts on Zillow, Cozy and elsewhere. Plus, you'll always have that video to use in future listings.