PSI Virginia Real Estate Practice Exam

Disable ads (and more) with a membership for a one time $2.99 payment

Prepare for the PSI Virginia Real Estate Exam. Study with flashcards and multiple choice questions, each question has hints and explanations. Get ready for your exam success!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

What is a function of property management concerning rental rates?

Set rates above market value
Ensure rates are competitive while covering costs
Eliminate expenses to lower rates
Charge tenants based on personal criteria

The correct answer is: Ensure rates are competitive while covering costs

Property management plays a critical role in determining rental rates that align with current market conditions. The primary function related to rental rates is to ensure they are both competitive and capable of covering the operational costs of the property. Setting rates too high may result in prolonged vacancies, while rates set below market value can lead to potential financial losses. A well-informed property manager will analyze comparable properties in the market, assess the demand for rentals in the area, and take into consideration the specific features and conditions of the property in question. By doing so, they can establish a rental rate that attracts potential tenants while also ensuring that expenses such as maintenance, property taxes, and management fees are adequately covered. This approach balances profitability for the property owner with fairness to tenants, fostering a harmonious rental environment. By focusing on competitive rates rather than arbitrary pricing strategies or personal criteria, property management can optimize occupancy rates and maintain the property's value over time.