Property Management Blog

How We Approach Rental Pricing

Professional property management isn’t about chasing the market — it’s about leading it.

We rely on real performance data such as:

• Listing views

• Showing activity

• Tenant engagement

• Application trends

These indicators tell us when a property is priced correctly — and when adjustments need to be made quickly to protect income and tenant quality.

This process helps owners avoid prolonged vacancy and make decisions based on facts, not guesswork.

Own a Rental Property?

If you own rental property and want help pricing it strategically from day one, we’re happy to have a conversation.

You don’t need to guess — and you don’t need to learn the hard way.

Contact us now.
https://www.reddoorrents.com/contact


DISCLAIMER:
This discussion is for educational purposes and reflects general market behavior. Pricing strategy should always be evaluated based on individual property and market conditions.

• Transcript Here

  Property Management Bonehead: “The Let’s Try It Listing” 

  Let's talk about today's property management bone head, the let's try it listing. This one is extremely common and honestly, it comes from a very relatable place. We hear owners say things like, "Let's start high. We can always come down. We don't need it rented immediately. If someone really wants it, they'll pay for it." Or my personal favorite, Zillow says,

  Right now, here's the important part. This isn't a bad owner. This isn't a greedy owner. This is an owner reacting emotionally to pricing an asset they care about. Owners don't overprice because they're greedy. They overprice because they're hopeful.

  Here's what actually happens next. The listing goes live and in the first 7 to 10 days, the property gets more exposure than it ever will again. Tenants see it, they save it, they compare it, they tour it, and then they don't apply. That silence is feedback. No applications isn't neutral. It's a rejection.

  Now, let's talk about hidden damage of just trying it.

  Overpriced listings create listing fatigue. Tenants start assuming something is wrong, showing requests slow down, urgency disappears, and the best tenants, they choose another home. What's left over time are applicants who are more desperate, have weaker credit, or are looking for shorter term solutions. The longer a listing sits, the worse the applicant pool gets, not better.

  Eventually, the owner agrees to a price reduction, but by then, the damage is done. The listing is stale. It's no longer new in search results. The top tier tenants are already gone. Now, instead of competing upward, we're competing downward. Price reductions don't reset the clock. They reveal hesitation.

  Let's put real numbers to this. Say you list a home $100 over market. It sits in after 30 days. Monthly rent is $1,800. That's $1,800 in lost rent. To recover that loss with a $100 premium, it takes 18 months. One month of vacancy erases a year of winning on rent.

  Here's what professional property management actually looks like. We price at or slightly below market. We create urgency and competition. We let demand push price upward. And we adjust it quickly based on real feedback, not feelings. We don't chase the market, we lead it.

  So, here's today's bonehead takeaway. The biggest mistake owners make isn't pricing it too low. It's pricing emotionally instead of strategically.

  Mike, what do you think?

  Chris, I love that you brought this up. I didn't know you were going to talk about this today. It is so so true. I would actually even add to that. I think by pricing it too high and feeling out the market also pricing it too early and feeling out the market because to your point you're going to see the most activity when it first hits the market. That's when you're going to see the most activity.

  100%.

  And so you got to be priced right. You got to—your condition has to be right and you got to be ready to move on it. Like if you price or if you put on the market 60 days out that's too early. It's just way too early.

  Chris, I was looking around while you—I have a graph I was finding while you were talking there and it just shows your point perfectly. So, this is from a company called Rent Engine and actually we're starting to move our showings to them. But, anyway, they have—I don't know how many hundreds of thousands of doors that they manage showings on. So, they're able to pull this is real real data from real property managers. And I think this was Q3 of 25, maybe Q4 of 25. Can't remember what this is from, but it's really relevant data.

  So, this shows the lead volume drops quickly after the listing. This shows exactly what you're saying here. And they even highlight this: 38% of all leads arrive within the first week on the market. I mean, look at this. And then it just as time goes on, it just trails off to next to nothing. You know, after 60 days, you're just—I mean, leads are just trickling in on average.

  Yeah. This just goes to show you exactly your point is that you've got to have it priced right. Like you want to be priced right in the right condition right here, right at the beginning when you're maximizing your lead volume.

  This is real data that almost never makes it to an owner. If you're dealing with just your average property management company, they're not even reviewing these factors, right? And for such a long period of time now, we've been providing weekly updates to our owners, insisting that they react quickly based on the numbers and the feedback that we're providing them. Those numbers are clicks, how many showings we've officially had on the property. And those numbers are exactly what are informing us. That's the real feedback, right? On that there are steps that need to be taken in order to increase those numbers in order to produce applications. So reducing the rent quickly here is absolutely essential and this is real data that backs it up. That's it.

  Yeah. And that that's why we do those weekly owner updates like you said to show the real data. If we have no volume, we need to reduce immediately. It's like almost an emergency because you're wasting time. I mean if you say, "Oh, I'll wait two weeks." I mean, look at this. You're already dropping to like 50% of your—or less than 50% of your lead volume. So, I mean, it's—you got to take it really really seriously at the beginning and be very very reactive at the beginning.

  Yeah. And I bring this up primarily because we have a lot of owners, of course, that are investing in new construction or they're just purchasing a property with your standard amount down with a higher interest rate. So, they're trying to achieve not only to cover their cost, but they obviously want cash flow in a lot of these scenarios and that's requiring them to list way above market value and that's what's leading to these situations which is why I made it today's property management bone head.

  So, there it is.

  Yeah, there it is. There's your property management bonehead and how you can react when you're vetting your new property management company and how they're going to provide market updates and suggest a listing price starting point. And if they're just a let's start somewhere and reduce as necessary, that is not a good starting point for all the reasons we've just listed.

  So, all right, let's close that segment out and we're about to jump into this week's question of the week.