A record-breaking 43.5 million people visited Maryland in 2022. As property managers, this surge in visitors offers significant potential, particularly during holidays or major events. Prorated rent can help you accommodate short-term renters during these peak times.
By prorating rent, you can provide flexible leasing arrangements to capture this group's interest. Here's how to calculate prorated rent so your property can make money all year.
How to Calculate Prorated Rent
Find the daily rent cost by dividing the monthly rent by the number of days in that month. Multiply the daily rent cost by the number of days the tenant will live on the property for that month.
For example, if your monthly rent is $1,200 and February is the month in question (28 days), the daily rent would be $42.86. If a tenant moves in on February 10th, they would pay for 19 days, making their prorated rent $815.34.
Tools for Property Managers
Some property management software and services can do the math for you, making your job easier. This frees up time so you can focus on other parts of managing your real estate.
AppFolio simplifies rent adjustments. This tool is useful during tenant shifts mid-month. It helps property managers calculate rent without having to do it manually.
Cozy, on the other hand, serves many roles. Known mostly for tenant screening, collecting rent, and handling maintenance requests, it also calculates prorated rent.
Above all, professional property management companies offer a wealth of expertise and full-scale services. They provide more than just software tools like AppFolio and Cozy; they deliver tailored support across all areas of real estate management. Whether it's managing upkeep or keeping up with legal requirements, they handle everything needed for your rental property to excel.
Legal Considerations
While prorated rent is common, it's important to know your local laws. Some places have specific rules about how to handle prorated rent.
Make sure you're doing things right to avoid any trouble. Checking with a legal expert or using reliable property management software can help you stay on track.
Benefits and Drawbacks of Prorated Rent
Prorated rent attracts diverse tenants to landlords. It appeals to those needing short-term stays or moving on flexible dates.
This can fill vacancies quickly, ensuring a steady income all year. Plus, it gives landlords an edge, making them seem adaptable and competitive.
However, prorated rent has its downsides. Its irregular nature may lower monthly income if there are pauses between tenants. Plus, adjusting lease agreements and handling frequent tenant changes add considerable administrative work.
Also, tenants can still end the lease agreement at any time. As a result, you could end up reserving a spot for someone who's unreliable.
Easy Rent Calculations for Property Managers
Managing property can be complex, but with prorated rent, solutions abound. This approach helps accommodate the seasonal visitor surge and draws new tenants. But remember, it can disrupt your monthly income and add work.
As experienced property managers, we're here to simplify things. Our expertise can help you navigate rent calculations in the Germantown, Maryland area. Contact us to help your property thrive.
