How much rent should you charge?
In Malaysia, the right rent starts from what the place costs you to own each month, plus the months you expect it empty, plus the profit you want. The empty month is what gets left out: rent set exactly at your monthly cost loses money every year. This calculator works out all three, then compares the result with your area.
- Cost of owning per year
- RM 18,900.00
- Monthly cost if never empty
- RM 1,575.00
- Added because of the empty month
- + RM 143.18
- Break-even rent
- RM 1,718.18
- Suggested rent
- RM 2,018.18
- Against your area
- Over the local rate. Your costs demand more than the area pays.
How does this calculator work?
The yearly cost divided by the months actually let gives the break-even rent. An empty month is carried by the months that are let, not by all twelve, which is why break-even is higher than the monthly cost. The profit you want is added on top.
Frequently asked questions
- How much rent should I charge?
- Start from what the place costs you to own each month, add what the months you expect empty cost, then add your profit. Then compare that against three similar units in the same neighbourhood, not the whole city.
- Why do empty months matter?
- Because the cost of owning does not stop when there is no tenant. If you expect one month empty a year, the eleven months that are let have to carry twelve months of cost.
- What if my costs demand more than my area pays?
- That is a signal about the purchase price or the costs, not a rent to advertise. Pricing above the local rate usually means longer empty, which costs more than the lower rent would have.
- Should I include the loan instalment?
- Include it if you want the rent that covers your cash out each month. To compare returns between properties instead, use the rental yield calculator.
- When should I raise the rent?
- Once a year at most, and weigh the raise against your turnover cost. An extra RM 50 a month is RM 600 a year, and one empty month can eat more than that.
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