The Rent Sweet Spot: How to Price Your Property for Profit (and Less Vacancy)

Smart Rental Moves: A 4-Part Series for Homeowners (Part 2)

If your rental has been sitting longer than expected… or you’re not charging enough to cover expenses — this one’s for you.

Setting the rent might seem simple. Just check Zillow, pick a number, and go — right?

Wrong.

In the Billings rental market, guesswork can cost you thousands.
 Price too high? You’ll face long vacancies and frustrated tenants.
 Price too low? You’ll leave money on the table every single month.

The key to success is finding the “Rent Sweet Spot”: high enough to protect your profit, low enough to attract quality tenants quickly.

At Premier Property Management, we’ve priced hundreds of units across every type of rental — from downtown apartments to suburban duplexes. In this post, we’re sharing the exact strategies we use to help owners:

• Maximize cash flow

• Avoid long vacancies

• Retain great tenants

• Stay competitive in a shifting market

Real Example: Two Owners, Two Different ResultsLet’s compare two nearly identical properties in west Billings — both 3-bedroom, 2-bath rentals in the same neighborhood:

Owner A decided to price her rental at $2,250/month — $150 higher than market comps — hoping to push rent in the area.
 Result? 33 days vacant. Lost income: $2,250.

Owner B, working with our team, priced hers at $2,095/month — right in line with comparable rentals.
 Result? Rented in 6 days to a well-qualified tenant. Full-year income: $25,140.

Owner A’s pricing decision cost her more than a full month’s rent — for no added benefit.

Why Pricing Matters More Than You Think

Here’s what we’ve seen firsthand in property management Billings:

Setting rent is about more than “what you want to earn.”
 It’s about what the market will bear — and what the right tenants are willing to pay.

1. Use Real Market Data (Not Gut Instinct)

Far too many owners price their rental based on:

• What they “need” to cover their mortgage

• What they heard from a friend

• A guess based on one Zillow listing

But the market doesn’t care about your mortgage. It cares about comparables — and so do quality tenants.

How We Do It at Premier:

• Pull comps from multiple sources: Zillow, Realtor.com, Rentometer, MLS

• Compare your rental to similar units in size, location, amenities, and condition

• Review actual leased prices — not just asking prices

• Track seasonal shifts and rental demand trends in Billings

We also factor in intangibles:

• Is your property pet-friendly?

• Does it have updated features?

• What’s the walkability or school district rating?

A well-priced unit gets 3x more applications in the first 7 days on market.

2. Know When (and How) to Raise Rent

Raising rent is essential to keeping up with inflation, maintenance costs, and market trends — but there’s a right and wrong way to do it.

When to Consider a Rent Increase:

• You’ve improved the property (new appliances, flooring, etc.)

• The market has shifted upward based on comps

• Your tenant has been on a flat rate for 18+ months

• You’re consistently renting under market rate

How to Do It Without Losing Good Tenants:

Our Approach:

• Give plenty of notice (45–60 days)

• Show data on how your property compares to others

• Emphasize continued service and improvements

• Keep increases reasonable (typically 3–8% annually)

Example: One of our long-term tenants accepted a $95/month increase without hesitation after we repainted the unit and added a smart thermostat.

3. Time It Right: Seasonality in the Billings Market

Believe it or not, when you list your rental can impact how much you earn.

Best Months to Rent in Billings:

• Late Spring to Early Fall (April–September): Most active rental season. Tenants are relocating, students are graduating, families are moving.

• Slower Months: November–January. Fewer applicants = more price sensitivity.

If your lease ends in a slow season, you may:

• Need to lower rent to fill it

• Wait longer to find qualified tenants

• Be stuck carrying a vacant property over the holidays

Smart Strategy:

• Adjust lease lengths so renewals fall in peak season

• Consider  12- or 15-month leases strategically

Properties listed in May–July rented 41% faster on average than those listed in December–January.

4. Use Incentives — Not Discounts

Sometimes, owners think the only way to attract tenants is to cut rent.
 But discounts can hurt your bottom line long-term and set poor expectations.

Instead, use incentives that add value without slashing your pricing.

Incentives That Work:

• First month half-off with a 15-month lease

• Free application or admin fees

• $100 gift card upon move-in

• Include smart home upgrades (Nest thermostat, Ring doorbell)

Goal: Make the property feel like a better deal — without lowering your asking rent.

5. What a Property Manager Looks At Before Setting Rent

As a Billings property manager, we consider much more than square footage and rent comps. Here’s our internal checklist:         

We combine data with our local expertise to strike the right balance:
 Competitive, profitable, and attractive to quality tenants.

The Cost of Getting It Wrong

Let’s say your market rent is $1,800/month.

If you overprice at $1,950 and stay vacant for 30 extra days, here’s what happens:

• Lost rent: $1,800

• Higher carrying costs (utilities, taxes, insurance): $200–$400

• Stress & re-marketing costs

You’d need almost 9 months at the higher rent just to break even.

Getting the price right upfront saves time, money, and headaches later.

Owner Objection: “But My Property Is Nicer…”

We hear this one a lot — and as property managers, we get it.
 You’ve poured time, money, and care into your rental. Maybe you:

• Chose modern fixtures

• Repainted everything top to bottom

• Installed brand-new stainless steel appliances

• Keep it immaculately clean between tenants

It’s natural to feel like your property deserves a premium price.
 And in some cases — when the neighborhood and market align — you’re absolutely right.

But here’s the hard truth many property owners don’t always want to hear:

No matter how beautiful your rental is, the market determines the rent — not your investment, your upgrades, or your opinion.

Renters Shop By Price, Then Compare Features

Imagine you’re a tenant looking for a 3-bedroom rental in Billings.
 You set your price filter: $1,800–$2,000/month.

You now see six options in that range — all within a similar area.

If your unit is priced at $2,200, it never even shows up in the search.
 And if it does show up because they expand their range, you’re now being directly compared to:

• Larger homes

• Homes with garages or fenced yards

• Homes in more desirable school districts

Even if yours is cleaner or newer inside, price trumps polish in most tenant decisions — especially in entry-level or workforce housing.

Upgrades May Add Appeal — But Not Always More Rent

Upgrades are valuable — they help you lease faster, attract better tenants, and retain them longer.
 But that doesn’t always mean you can charge significantly more.

Here’s how we break it down for our owners:                 

The key is this:

If your upgrades are standard for your price point — or not clearly superior to local comps — tenants won’t pay significantly more.

Example: Overpricing Based on Pride

One of our clients had a beautifully renovated two-bedroom townhome in west Billings.
 Quartz counters. New flooring. Designer light fixtures.

He wanted $1,750/month — $250 higher than the next most expensive 2-bedroom nearby.

We advised $1,495–$1,525, based on comps.

He chose to list at his target price, saying, “But none of those other places look as nice as mine.”

After 34 days and only one showing, he dropped to $1,550.
 It rented a week later.

That 34-day vacancy cost him over $1,600 in lost income.
 A $25–$50 monthly gain wouldn’t have covered it for over two years.

What You Can Do Instead

If you believe your property is worth more, focus on:

• Highlighting your upgrades in marketing (photos, descriptions, video tours)

• Offering flexible lease terms or included utilities

• Keeping your unit in top shape to reduce turnover and maximize renewal success

• Working with a property manager who knows when — and where — you can command more rent

The best rentals don’t always rent for more — but they do rent faster, to better tenants, who stay longer and take care of the home.

Bottom Line

Your pride of ownership matters — and it does make a difference in tenant experience and retention.
 But when it comes to pricing, let the market lead.

We’re here to help you find the sweet spot where:

•  Your rent reflects your property's value

• Your unit rents quickly

• You avoid the silent cost of vacancy

Want a second opinion on your rental pricing?

📞 Call us at 406-540-8040 or schedule your free rent analysis.

We’ll run a full comp report, assess your upgrades, and help you determine whether your property actually stands out enough to justify a premium — or whether you’ll make more by getting a great tenant in faster.