When renting out an apartment, the owner naturally wants to achieve the best possible rental income. However, the highest possible monthly rent does not always produce the best overall result.
If an apartment remains vacant for a month because the asking rent is too high, the owner's loss may be greater than accepting a slightly lower rent and finding a reliable tenant quickly.
Rental pricing should therefore be assessed not only for a single month, but over the entire rental period.
What determines an apartment's rental price?
The main factors affecting rental price include:
- location;
- apartment size and number of rooms;
- condition and furnishings;
- utility costs;
- parking space and storage room;
- balcony or terrace;
- condition of the building;
- public transport and nearby services;
- supply of comparable apartments;
- seasonal demand.
Even two similar apartments in the same building may achieve different rents.
The asking rent may not reflect the actual market price
Property portals primarily show the rents that other owners are asking.
It is also important to assess which apartments find tenants quickly and which remain available for longer.
If similar apartments in an area are offered for €700–€750 per month, this does not automatically mean that every apartment of the same size should be listed at €750.
The condition of the apartment, furnishings, additional costs and competition all influence the rent tenants are actually willing to accept.
Does a higher rent mean higher income?
- Not always.
- Suppose the realistic rental price of an apartment is €700 per month.
- The owner decides to ask €750, but as a result the apartment remains vacant for one month.
- Recovering the lost €700 through an additional €50 per month would then take 14 months.
In addition, while the apartment is vacant, property-related costs usually remain the owner's responsibility.
For this reason, setting the right rental price can produce a better annual return than starting with the highest possible asking rent.
The right price helps you choose a better tenant
An apartment priced reasonably will usually receive more relevant enquiries.
This gives the owner an opportunity to choose between suitable candidates instead of accepting the first interested person simply because the apartment has already been vacant for a long time.
Before signing a lease, it is worth checking the prospective tenant's background and clearly specifying the rent, additional costs, deposit, payment deadlines and conditions of use in the agreement.
In a long-term tenancy, a solvent and reliable tenant may be more valuable than an extra few dozen euros in monthly rent.
When should the rental price be changed?
If a listing receives many views but few enquiries, one possible reason is that the rent is too high.
If there are enough interested people but no suitable tenant is found, the problem may not be the price — the listing, photos, terms and target group should also be reviewed.
The rental market changes, and the right rental price for the same apartment may be different a year later.
It is therefore worth reassessing market conditions before each new rental period.
A good rental result is not only about the maximum monthly rent
The owner's actual result is affected by a combination of:
rental price + vacancy + additional costs + tenant payment behaviour + duration of the tenancy.
The goal is therefore not simply to find the highest rent, but a price that gives the owner a good and stable overall result.
Vendor Kinnisvara helps owners in Tallinn and Harjumaa determine a realistic rental price, find a suitable tenant and manage the rental process.
If you would like to know what rent your apartment could realistically achieve today, send us the property address or a link to the listing.
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Helps owners rent out apartments and find suitable tenants.
