Setting rents by evidence, not by the last deal
Most residential portfolios are re-let at whatever the previous tenant paid, give or take. A quarterly guidance band gives the leasing agent a number to work to and the owner a way to check it.
Ask how a renewal rent was set and the answer is often the last deal in the building, the agent's feel for the market, or what the tenant was willing to accept. None of these is wrong on its own, but across a portfolio of dozens of units they add up to rent left on the table in a rising market, or voids in a falling one.
A band, not a single number
Each quarter we set a guidance band for every building and unit type, built from registered tenancy contracts and live listings for comparable units. The band is narrow enough to be useful and wide enough to let the agent negotiate. Any deal inside the band goes ahead; any offer outside it comes back to the owner with a reason.
What goes into the band
- Registered tenancy contracts for the same building and unit type over the last two quarters
- Live listings, adjusted for the usual gap between asking and achieved rents
- Days on market and void length for comparable units
- Handovers nearby that will add competing supply over the next twelve months
- Service charges, which change what a tenant will pay for the same unit
Closing the loop
At the end of each quarter, achieved rents are compared with the guidance. That shows where the band was right, where the agent beat it, and where it needs to move. For a Dubai family office we support, this cycle replaced pricing by the last deal with a written guideline the leasing agent follows every quarter.
We track risks like this for every asset in the portfolios we monitor, alongside quarterly rent guidance and hold or dispose calls.
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