Your Must-Follow Guide for How to Determine Rent Price

Table of Contents

Knowing how to determine rent price is critical for your property. Investing in income-producing real estate is only a benefit to your portfolio if you can get the right price for your property. Set that figure too high and you might not be able to retain tenants. Set it too low, and you may either miss out on revenue or end up without the quality of tenants you want in your rental home.

This guide will walk you through everything you need to know to set the ideal rental price for your property, from how to choose the right real estate investment at the outset of the process to the factors that influence the monthly amount you should be asking.

Choosing the Right Investment Rental Property

Setting the right rental price starts with choosing the right property. There are several facets that go into choosing an ideal investment property. Take a look at the home’s price and what other rentals in the area go for, then carefully consider factors such as:


Where is the property located? A rental in a good area of town can go for a higher monthly amount than a property in a less-affluent area.


Before you choose a new property, consider how many renovations the property will need. If you need to take care of more extensive renovations before renting out the property, it can increase your initial investment and leave you needing to charge more rent in order to effectively pay the mortgage and pay off the rest of your investment in the property.

The Size of the House

Size matters when it comes to choosing the ideal rental property. A large property will often go for higher rent than a smaller one. Keep in mind, however, that you do have to consider the property’s location as well as its size, since properties in certain areas may be worth more than others.

Considering these factors means you can often make a better decision about whether to purchase a house. When it comes to rental properties, it’s always better to walk away from a potentially bad investment than to invest in a money pit that could leave you scrambling to pay for the mistake.

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4 Ways to Determine the Best Rent Price

Your rental price can have a huge impact on your business, including whether you can attract renters or will struggle to pay the bills associated with the property. You must thus take a look at several important factors to be sure you have determined the best price for your rental properties, including:

1. What rent do other properties in the area go for?

Units of a similar size and value should be your guide. How much do they typically go for in the local market? Consider the assets, benefits, and options offered by those rental properties. Make sure you include the number of bedrooms and bathrooms as well as the actual square footage of the unit as you evaluate what your unit is worth compared to others on the market.

2. Which benefits does your property offer?

Take a look at your property compared to others in the local area. What do you offer renters who choose your unit? You may want to look at:

  • The number of bedrooms in your unit
  • Whether you offer a washer and dryer or other important appliances
  • What services you provide to your renters, including trash pickup, pest control, or yard maintenance
  • Whether your unit is part of a larger complex that offers features like a pool, a party room, or other important amenities

Many renters will pay higher rent prices for amenities that appeal to them and their families.

3. How much are you paying for your rental property?

Consider the expense associated with purchasing the property, including your monthly mortgage, as well as other costs associated with running the property, like property taxes. You may need to include the costs of regular maintenance costs and repairs or calculate the cost of using a property manager. If you use a property management company to handle rental units, you should include only the cost for that unit in your calculations. If you cannot set a fair rental rate while still covering those expenses, it might be a good idea to consider a different rental property.

4. What season is it?

People are more likely to move during the summer months. Moving is naturally more inconvenient during the winter, especially for families that have children. If you need to put a unit on the market during the winter months and you need to bring in renters fast, you may want to reduce the number. The potential rent you can collect during those months may be enough to offset the long-term loss from lower rent, especially if you need that rental income to pay the mortgage.

Once you have set your rental price, keep an eye on changes in the market or in the local area. You may need to adjust your rental prices annually or between renters in order to maximize the benefit to you.

Couple working with advisor to determine Rent Price

3 Common Mistakes in Calculating Rent Price

Are you getting ready to set the rental price for a new unit or recalculating the ideal rent for your current one? Avoiding these mistakes may mean you are able to set a more effective rate.

Mistake #1: Using the 2% rule alone.

Many landlords use the 2% rule to determine how much rent they want to charge: they charge 2% of the current market value of the property in rent each month. While that number is a good starting place, it’s important to take a look at the rental market in your area and carefully consider comparable properties before setting your rent. The 2% rule may aid in your collection, but there are many factors to consider as you set the cost per month for your properties.

Mistake #2: Failing to take your cash flow into consideration.

You may have money going out to pay the mortgage, take care of maintenance costs, and manage property taxes. If you don’t consider your costs in your calculation, your investment property can quickly become a money pit.

Mistake #3: Ignoring other properties in the area.

Many landlords make the critical error of failing to carefully examine other properties before setting their rental prices. You can have a great property, but if you fail to examine other rentals in the area, you might not know how much to charge in order to maximize your income while still attracting tenants to the property.

If you have made mistakes in setting rent in the past, you know just how detrimental it can be. Luckily, by taking a look at these mistakes, you can help set yourself up for higher levels of success as a landlord.

Work with the Professionals

Do you have questions about how to set the ideal rental price for your rental property? Many real estate investors have successfully navigated the rental market with these strategies. If you still have questions, Nomadic Real Estate can help. Contact our team today to speak with an expert about any questions you might have about property management and how to determine rent price.

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Enhanced Reporting

Your portal includes a selection of extremely useful reports. Reports are available in the “Reports” section, and are distinct from the financial statements. Unlike financial statements which are static records, Reports are dynamic real-time records that will update with current data every time you view them. 

Scroll down to learn more about Reports:

Navigate to the "Reports" module in your portal:

Owner Portal Reports
  • Keep in mind, these reports are dynamic records. They will refresh to display current information every time you view them. 

Enhanced Rent Roll Report:

Enhanced Rent Roll Report
  • The Enhanced Rent Roll Report will show the rent amount, last payment date, move-in date, lease expiration date, and security deposit amount for each of your tenants. 
  • It will also show a portfolio summary with occupancy percentage, vacancy loss, and more!

Unit Comparison Report:

Unit Comparison Report
  • If you own multiple units (or buildings) with Nomadic, you’ll get access to the Unit Comparison Report. 
  • This report enables you to quickly compare financial performance between your units at a glance without toggling between individual reports. 

Income Statement Month-Over-Month:

Income Statement by Month Report
  • The Income Statement Detail – Monthly Report serves as a month-over-month record of portfolio performance. You’ll see itemized income and expense categories and can track monthly. This report will update with fresh data every time you view it. 

Financial Statements

Financial statements will be published to your portal on a monthly basis. The statements are found in your Documents library, and provide a historical record of all financial performance. The statements serve as a snapshot of financial performance over a given period, and are static documents (unlike Reports, the statements do not update/change in real-time). 

Scroll down for more info about the Financial Statements in your Documents library:

The Documents area contains monthly financial statements:

Owner Portal Documents
  • The statements in the Documents are are static documents. They are posted to the portal once a month to serve as a historical record of financial performance. 

Download a statement to see month and YTD financials:

Owner Portal Property Statement

You'll also find a month-over-month operating statement:

Month over Month Statement

Portal Communication Tool

You can use your owner portal to communicate with our team. Any messages you send through the portal will go straight to your Account Manager. When we reply, you’ll get an email notification and you’ll also see the message in your portal next time you log in. 

Here’s an overview of using the communication platform:

Click "Communications" and navigate to "Conversations":

Commincation Dashboard Screenshot
  • The communications module will contain a record of all messages that you create through the portal. 

Click the "New Message" button and send your message:

Owner Portal New Message Screenshot

Responses will show up in the conversation ticket:

Portal Conversation Response Screenshot
  • You’ll get an email notification whenever you get a response, and you’ll also see the message in your portal next time you log in. 

You can reply in-line using the comment box:

Owner Portal Comment

Each conversation will be logged in its entirety:

Portal Conversation Snapshot

Understanding the Ledger

Your portal includes a ledger with all transactions. The ledger is populated with data in real-time as transactions flow through our accounting software. Much of this information is also available in the Reports area, as well as the Statements in your Documents library, but the ledger is the most comprehensive resource for diving into the details. 

Please scroll through the sections below to get a better understanding of how to interpret the ledger. 

By default, transactions are sorted chronologically:

Owner Ledger Dates
  • The date reflected in the lefthand column is the actual transaction date, not the “bill date”. This is the date the transaction was actually processed. 

If you have multiple properties with Nomadic, you'll see the address for each transaction in the "Location" column:

Ledger Property Column
  • You can filter the ledger to look at just one property, all properties, or specific sets of properties. 
  • If you only have one property with us, you’ll just see the ledger for that property. 

The Description column displays the transaction type:

Owner Ledger Description Column
  • BILL: this is an expense transaction, such as for repair costs or management fees.
  • CHARGE: this is a transaction  billed to the tenant, most typically a rent payment. 
  • NACHA EXPORT: this is a credit we processed to your distribution account. This type of transaction is how you get paid! 

The Amount column shows the dollar value of each transaction:

Owner Ledger Amount Column
  • Positive Amounts: if an amount is positive, it reflects a transaction that is payable to you. Typically, this will be a rent payment that we collected from your tenants. On occasion, a positive number could also signify a journal entry or credit adjustment. 
  • Negative Amounts:  if an amount is negative, this is a transaction that is either payable to Nomadic or is an amount that has already been paid to you. Typically this will be for repair costs or management/leasing fees. Owner draws (net distributions into your checking/savings account) also reflect as negative amounts, since they have already been paid to you. 

The Account Balance column shows a sum of positive/negative transactions at a given point in time:

Owner Ledger Account Balance Column
  • Account Balance should always equal zero after a net distribution has been processed. When the balance is zero, this means that all expenses have been paid and you’ve received the remainder as net operating income, leaving a balance of zero (meaning: no one is due any money, as all funds have been distributed appropriately). 

Navigating the Propertyware Owner Portal

Your portal includes some extremely useful features that help you understand your property’s financial performance at a new level, with real-time transparency into every transaction.

Scroll through the snapshots below for an overview of portal navigation! If you need more help or have specific questions about using the portal, you can reach out to your Account Manager any time for a screen share. 

You can filter all info by date range or property:

PW Portal Filters

View a snapshot of income and expenses on your dashboard:

PW Owner Dashboard View

See every transaction in real-time on your ledger:

Owner Portal Ledger View

Statements and forms will be posted to your documents library:

Owner Portal Document Library

View a suite of real-time financial reports:

Portal Reports View

See a running list of all bills, and drill down for more detail:

Owner Portal Bills View

Under Bill Details, you'll find dates/descriptions/amounts and more:

Portal Bill Details

You can also communicate with your Account Manager through the portal:

Owner Portal Communication Tools

How do net distributions work?

Net distributions keep your accounting clean and simple. Each month we’ll collect rent from the tenants, deduct any repair expenses for the previous month and any management/leasing fees for the current month, and credit the remaining net operating income to your account. 

Net Distribution

You’ll receive a statement via email each time a net distribution is processed, and can view all transaction details in your Propertyware owner portal.