Did you become a Springfield, MO rental property owner to make passive income? Passive income is money earned without a lot of effort. You can hire property managers to handle operations for you.
This includes prorated rent calculations. Offering prorated rent is a great way to squeeze in a little extra income. Keep reading to learn how to calculate it.
Defining Prorated Rent
Property managers and landlords charge prorated rent to tenants who move in early or move out late. The rent payment amount is based on the days a renter stays in the unit. This occurs when they are not there for a full month.
Prorated rent amounts should be discussed before the lease agreement is signed. This way, the amounts can be added to the lease.
If a tenant asks to stay a few days after the lease ends, you can choose how you want to go about this. If you don't have a tenant lined up to move in after them, it could be beneficial to offer a longer stay and take the prorated rent.
Tenants might not want to renew their leases but will stay a few days extra. To ensure there are no disputes, put this agreement in writing and have both parties sign it.
Prorated Rent Laws
Missouri doesn't have state or local rent control laws. If a landlord chooses, they can charge the full rent amount for the month no matter when a tenant moves in or out. This will be outlined in the lease agreement.
Other landlords automatically prorate the rent. Either way, landlords get additional rental income and can lessen vacancy times.
It doesn't go against landlord-tenant laws to charge the full rent amount. However, it could be good practice to prorate rent to keep tenants happy. This can help with overall relations.
How to Calculate Prorated Rent
Knowing how to calculate prorated rent is a helpful tool. A rental property management company will automatically do these calculations for you.
The most common method of calculating prorated rent is by using the number of days in a month. This is either 30 or 31 days unless it's the month of February.
You will divide the monthly rent amount by the number of days in the month the tenant is moving in or moving out.
As an example, let's say that the monthly rent is $1,500 and the tenant is only staying 10 days in September. The calculation would look like this:
- (1,500/30) x 10
Rent is $50 per day in September. The tenant is staying 10 days. The prorated rent is $500.
This amount will be different based on the rent amount, month, and how many days the tenant stays. You can always use the same equation.
How Can Property Managers Help?
Property managers can do all of the leg work for you. They can calculate prorated rent and handle day-to-day operations for your Springfield, MO investment.
Hunter Property Management always puts the needs of clients first. For more than 34 years, we've provided property owners with peace of mind by protecting their investments.
Our client-first approach is unlike others in the industry. Our people, processes, and technology help us deliver high-quality services. Partner with our committed team today!
