Property matters are so sensitive and require expert opinion when it comes to trade or valuation. We all have to be cautious with every step because one mistake can cause irreversible damage. Likewise, when you are about to rent your house, you have to prepare all the documentation and valuation methods to decide the rental value of your home. But how can a layperson decide the rent for their house?
Questions arise like; “What are rental prices in my area?”, “What’s rental value of my home?”, “What are rental values of my property?” and “How much should I charge for rent?”. It is kind of a frustrating situation for anyone. Here are some methods you may use to evaluate rent for property in Pakistan. Besides, have a look at virtual assistance in real estate.
- Comparison with Similar Properties in Your Area
- Analysis of Cost, Location and Amenities
- Per Square-Foot Cost Method
- Through Online Real Estate Platforms
Comparison with Similar Homes
The easiest way to evaluate the rental values of a property is to compare it with similar properties in your neighbourhood. Because the rent value has to be close to the rest of the houses in that area. Landlords/landladies often decide the rent of their home by valuating the rent of properties that have the same size, rooms and structure within a specific area. In this case, they do not have to make much effort and you can also do it. But this method works when all the properties have a similar structure, which you see in housing schemes where all the properties have the same format.
If you are thinking; “how much should I charge for rent? “. However, there are more methods ahead to calculate rent for your property.
Analysis of Cost and Amenities
Another way to decide the rental values of a property is via analysis of all the costs, expenses, supplies, and facilities in the house as well as in the town. If the cost of living is high, rent will also have an effect on it. For example, the cost of living in Islamabad is the highest in Pakistan as compared to the rest of the cities. The reason is the standard of living and amenities that are provided there. Similarly, the rent will be lower in an underdeveloped area or city than in a developed one. If your house is well constructed with the support of proper maintenance, its rent will be higher than a less maintained house. Each and every cost is included in it.
In most countries, the 1% rule is followed. Rental value is close to 1% of the purchase price of a home. Some use 1.1% or 0.9 % depending on what kind of comfort your house provides. In Pakistan, this percentage of rent valuation lies between 0.5% and 1% of the total value of a house. For instance, a house’s worth is Rs. 90 lac (9 million) and the rent will be between Rs. 45,000 and 90,000. Sometimes, the rent is lower than 0.5% of property price because of income factor, affordability of tenants and location’s value. Furthermore, you might also know if you compare property rent between a posh area and a moderate area. And that’s how you can find rent for your property. For instance,
0.5% x House Value = House Rent
Valuation Through Per Square-Foot
This method is handy if you know rental prices in your area. For instance, there is a house of 125 square yards with a rent of Rs. 40,000 and your house is 80 square yards. To find the rental value of your house, you need to find the value of that house first. Then convert it into square feet and you will get 1,125 square feet for that house. You will get a per-square-foot value that is Rs.35. Finally, you can know the rent for property in Pakistan. Now, you can multiple Rs. 35 with 720 square feet if you own an 80 square yard house. If the value and condition of the house are higher than the above house, you may charge higher. But this method depends on other properties’ rental values.
Monthly Rent/Total Square Feet = Rent Per Square Foot
Rent per Foot x Your house size = Monthly Rent
Digital Real Estate Platform
The last way to find the rental value of your home or property is through websites of real estate service providers. This one is the easiest of all, just browse through the website and find your area in it. You can easily get a vast range of properties with a rental value of each. It helps those a lot who have queries like “Rental prices in my area?”, “How much can I rent my house for?” or even “Rental values of my property?”. In addition, these digital platforms have tons of information about every city and town.
Jagah Online is one of those online real estate platforms that can help you evaluate rent for property in Pakistan. Furthermore, it is a unified platform where you can search and trade about properties in Pakistan but also find handyman services, home renovation and decoration goods, and investment opportunities in projects. These platforms will save your time, fuel and energy as compared to visiting a real estate agent’s office.
All the above methods can help you determine rent for your property. It depends on you which one suits you better, otherwise, you can always reach a real estate expert for your own consolation related to deciding rent for property in Pakistan. Meanwhile, you may try some other blogs like tips to make your home smart or balcony safety tips for your kids at JagahOnline’s blog section. Follow us on Facebook and Instagram for more information.