Calculate Rent Based on The Scenario

When calculating rent, always consider the price per square foot. Price per square foot is a key real estate metric both you and tenants will be looking at. Rent prices should shift from unit to unit based on square footage.

There are several options:

• You determine the rental prices entirely on a square foot basis formula. Meaning, you have a set dollar amount per square. With each increase or decrease in livable square-footage space, there is a direct correlation to an amount. For example, a $2.00 / square foot rate means a unit that is 600 square feet rents for $1,200 / month while an 800 square foot unit costs $1,600 / month.
• Rental rates based on the type of unit. 
  These different units being studios, 1BR/1BA, 2BR/1BA or2BR 2BA.
• Determine rent rates depending on a mix of price per squarefoot and the type of unit. This method works well for complexes that have multiple styles of units. For example, if you have two 1BR/1BA units but one is 200 square feet larger and remodeled, you would charge based on square footage and view or the level of remodeling performed.

Regardless of which option you choose to go with, make sure you also account for the differences in-unit amenities and changes in market demand.