How to determine property rental price and bond
Wondering how to determine property rental price and bond? You’re not alone. It’s one of the most common questions we get from property owners and private landlords.
Setting the right price on your rental property is vital. The price must be suitable for your property’s size, location, and condition if it’s to attract renters in your area.
In this article, we’ll show you how to determine property rental price and how to calculate the bond. Let’s get started.
How to figure out the right price for your rental property
Deciding on a fair price for your rental property isn’t rocket science – but it does take a bit of research. We suggest following this three-step process.
1. Research median rents
First, determine the median weekly price of rental properties in your suburb. It’s worth checking neighbouring regions, too. Focus on dwellings that are similar to your own. For example, if you own a two-bedroom apartment, look into the rental prices of other two-bedroom apartments.
To find median rents in your area, check out the following resources:
- New South Wales rent report: interactive maps identifying median rents and linking to sales data
- Victoria rental report: links to documents that detail median rents for districts across the state
- Queensland Rental Tenancies Authority report: an interactive table that lists median rents according to suburb and dwelling type
- South Australia rent reports: downloadable spreadsheets that list median rent across several reporting periods
- Western Australia Perth suburbs rental data: interactive tables that show rental data for any suburb in the Perth region
- Northern Territory housing report: rental housing data and graphs focusing on the most populated areas of the Northern Territory
Unfortunately, reliable sources for information on Tasmania’s and the ACT’s median rental prices could not be found. As an alternative, visit a rental property website and sift through the properties available in your area to gauge the approximate median rent.
2. Compare property features
Rental properties that look similar on paper can be vastly different. And determining rental value isn’t just about the number of bedrooms and location.
To ensure you are getting the highest return on your property while remaining fair, you must compare property features, including:
- The size of the property
- The condition of the property – newly renovated homes can bring in higher rents
- Any special or unique features, such as a large backyard, swimming pool, or premium appliances
- The property’s location within a suburb, including its proximity to public transport, schools, medical facilities, shops, parks, and other desirables
- Whether or not it’s a furnished rental property
- If it’s an apartment or unit, the property’s position within a building
3. Set a justifiable rental price
You’ve figured the median rental price in your area, and you have compared your property’s features to those of surrounding properties. Now, it’s time to set a price.
If the price you decide on is above the median, make sure that it’s justified. For example, if you have a three-bedroom home that is freshly painted and has a swimming pool, asking for an above-average rental price could be fair.
How to calculate your rental bond
In most instances, the bond amount will be subject to state rental legislation. Each state and territory has its own rules regarding bond amount and lodgement, and these rules are continually evolving. In Queensland, for example, lodging a bond with the RTA must now be done online. Victoria’s rental laws are also undergoing significant changes.
State legislation will determine a maximum weekly amount that can be used to calculate a bond by multiplying the weekly rental price by four. If your rental price is above this maximum, you are typically free to negotiate an appropriate bond with the renter.
As a private rental provider, you can also decide not to charge a bond at all. Do keep in mind, however, that legislation generally states that if a bond isn’t charged, the renters have no obligation to complete the entry and exit condition reports.
Keep up to date with rental laws in your state
Rental providers are subject to a whole host of rules that dictate things like rental price and bond amount. It’s imperative that you keep up to date with these laws and follow them to a T.
If you’d like help navigating complex rental laws, please find out more about our exclusive landlord coaching services.
Advertise your private rental property
You’ve decided on a price. Now it’s time to attract the right tenants.
For a limited time, you can claim your free professional listing with RentEzy. Find out more about our free rental property advertising for private landlords today.