Hey, everybody. Matthew Whitaker back with a question the owners ask. Today’s question is, “What makes a good Denver rental house?” So let’s talk about it.
And I’ve got my notes with me.
So, I’ve got five things that make a good Denver rental house, but before I get started, I want to tell you a little story.
I’ve been managing homes now for 15 years, and one of the things that I thought was funny is I had this incredible house on a great street.
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It Was Kind Of Like The Model House.
You imagine a neighborhood that had a bunch of similar sized, similar houses, and we priced it right in with what we were seeing other things lease for.
There was great demand in the area and this home was just not renting.
And we just couldn’t figure out why it wasn’t renting.
And finally, we drove over there one day and we realized it’s not renting because it has a chain-link fence along the backyard and then behind it is a graveyard.
So we built a privacy fence to kind of…to separate the graveyard.
Make sure all the ghouls and goblins don’t jump because obviously ghouls and goblins can get through a chain-link fence.
But they cannot jump over a privacy fence.
We built the privacy fence. Boom. The home rents.
So I’m going to get into that. That’s called a white elephant issue.
I’m going to get into that, but I thought that was kind of a funny story to kick this thing off.
So First Thing Is Let’s Talk About Houses For Rent
One of the things I think makes a great rental house is a very traditional layout, a layout that’s very similar to other homes in the area.
The last thing you want to do is get kind of broken up houses or bedrooms.
Which can’t really be called bedrooms but essentially a bedroom where you have to walk through another bedroom.
You don’t want to get a kitchen that’s really tiny or bedrooms that are really tiny.
Or, you know, you basically broke up a big bedroom into two really tiny bedrooms.
So Traditional Layouts Are Very Important.
People that are moving into the neighborhood typically know what a home should look like in that neighborhood, and so they want it to be traditional.
They don’t want it to be quirky.
And you’re obviously going to have to discount the price if the home has a quirky layout.
The Second Thing Gets Into My Graveyard Story Is No White Elephant Issues.
White elephant issues are things that are issues with the house that you can’t change.
So think about power lines in a weird space.
Commercial property right across the street or right behind it on a really busy road, these are things that a resident is going to pull up.
They’re going to see it, they’re going to know you can’t change it, and they’re going to discount it in their head because that exists.
So, again, this is where you would make an adjustment. If you do own one of these, you’re going to make an adjustment in the price.
But If You Don’t Have To Buy! (What Makes a Good Denver Rental House)
What you’re looking for as a buyer is cookie cutter.
And you want to know every house is very cookie cutter and what residents are looking for is very cookie cutter.
So you want to appeal to the masses.
You don’t want to appeal to just one or two possible residents out there.
The Third Thing Is, I Have Seen The Craziest Colors In My 15-plus Years Doing It. Hot Pink, Hot Purple, Black.
The last thing you want to do is turn someone off with your wide variety of color wheel.
What I would say is make this thing as neutral as possible.
Again, you’re trying to appeal to the biggest number of people possible.
And when you do that, you want to appeal to that 80% in the middle.
When you do traditional colors, then you’re going to kind of appeal to a wider audience.
The Fourth Thing, And We Talked About It Under One And Two, Is Just Market Price.
You need to know and not have unrealistic expectations about what that home’s going rent for.
We have frequent conversations where people are 25%, 30% higher than what the actual market value of the home is.
And so that’s obviously a problem.
And so you need to get realistic about what the market price is.
The Last Thing You Want To Do Is Overprice A Home, Have It Sit There, Have People Think That There’s Wrong With It. (What Makes a Good Denver Rental House)
Especially in hot markets like we’re having in Denver, and then all of a sudden your house won’t rent because it gets some sorta stigma to it.
So making sure it’s market price.
And then the last thing I would say that makes a great home is you.
You know, your ability to service that tenant, your ability to make sure you’re giving the tenant a good home.
You need to be the type of landlord or hire the type of landlord or property manager that gives them a great service.
So that’s it.
Those are five things that make a good rental house in Denver.
I hope this video was helpful.
Thanks so much.
Matthew is the CEO of Evernest. He is a student of the book Good to Great and is passionate about building the best property management company on the planet (and maybe even the universe if Elon Musk will hurry up). You can usually find Matthew at the baseball field with his son, at a dance recital with his daughter, or at his favorite restaurant with his wife, when he’s not in the office. And if you can’t find him in any of those places, it probably means he’s traveling.