When you are ready to put your rental on the market, knowing when to start marketing it is crucial to finding great long-term tenants. Poor timing could put you at risk for an extended vacancy and having your listing become ‘stale’, so read on to find best practices to time your rental right for your next tenants.
By pricing a property correctly and understanding both the monthly and yearly rental cycles, you have your best chance to reduce your vacancy and increase profits.
Timing for the Monthly Cycle
Tenants rarely move out until they have somewhere to move-in. Depending on where your investment is, this cycle will shift, but you can expect tenants to be looking for a new place right before they must give notice to their current landlord.
In the Seattle market, tenants that are leaving a month-to-month rental are required to give notice to their landlord 20 days before the end of the lease term. This is usually around the 10th of a month. This means there is a predictable drop-off of leasing activity each month around the 10th. So- the prime marketing period for May 1st move-in, for instance, will be from March 20th through April 10th.
Activity will quickly die down after the 10th. Landlords should therefore try and have their property listed on the market, in as many places as possible about 6 weeks prior to their desired move-in date, so by around the 15th-20th of May for July 1st. And they should adjust price based on results to find the market by the first week of [June, in this example], ensuring it’s rented by the 10th at the latest.
Timing the Yearly Cycle
The summer months are typically the “hot market” when investors can see an average 10% higher rent prices than what they could expect rents to be if rented in the depths of winter.
We see about 75% of the entire year’s leasing activity transpire in June, July, and August, with September 1st being normally the busiest move-in date of the year. But then the market dramatically slows in the fall.
If you priced too high in May and didn’t get it rented, the market may come up to that price in June. But if you priced too high in September, you might benefit from dropping the price quickly to get ahead of the downward curve that’s coming during the fall months.
Timing the Term End Date
Use the start time as a way to schedule your end date. Set your leases to end in May, June, or July (regardless of whether that means a 6, 9, or, 18-month initial term to get on a summer rental cycle).
This sets you up for future lease negotiations when market conditions are optimal, both with renewing and new tenants.