I have been tracking Zillow and Redfin for trends in my area for years. They have tools in the sites to post details of your property to get valuation estimate ranges (even customize the posting they have of your addresses since everybody's cribs are on those sites unless you go in and delete them.)

My rental is a single family home so it is easier to see recent sales figure trends and now they have rental history. My suddenly desirable tree-lined quiet peri-urban neighborhood (where I also live in another SFH) have gone up 20 to 30% in two years in rental and more like 40% to even 100% in sales price inflation. Literally no SFH listing in my area lasts more than a day before being "under contract" for above original listed price.

In fact the Zillow and Redfin sell price estimates on my two properties has nearly doubled in 4 years after 10 years of stagnation. Part of that is that hipster gentrification since Google opened an office here and a big hospital system expanded has driven absurd gentrification in neighborhoods closer to those facilities, so there are more people looking at our more affordable nearby location. So a 30% rental increase seems modest.

3 years ago you could rent a decent 2 or 3 BR with garage here for under $1000. Those start at $1350 now and I just raised the $1200 lease that ended in August to $1400. Evicting them anyway (long story posted elsewhere.) I will probably finish a few projects on the place once they are out at the end of this month and take advantage of the overheated sales market. I can clear over $100K on it in a heartbeat. Not bad for only owning it for less than 4 years.

This subject actually comes up a lot Don/MO. And my response is always the same: for us, there is a finite amount of people who can afford super-high rents in my area (all real estate is local.) Those who can soon buy homes.

If I go too high on my rents (and I base this amount on all the people who fill out my pre-screen questions over the year telling me how much they make) I will decrease my viable tenant pool AND put myself in direct competition with everyone ELSE trying to get top dollar, which means my houses have to be upgraded and updated on a regular basis. Cute & Clean will not be enough. But if we OVER-improve, we won't find enough people who can afford that stainless fridge.

We live in a tourist economy: the locals don't make enough money to afford the top-dollar houses. So we keep our prices as high as we can without chasing off the geese who lay the golden eggs.

Since rent prices have escalated so rapidly, it has been difficult to keep track of what the current market price may be. I have considered incorporating some sort of rent bidding in my process, or adding a wait list for upcoming vacancies, and setting the rental price at the time that it becomes vacant. Neither of those strategies maps well to posting a vacancy on a listing site, where you have to have a set rental price at the time of posting.

Since rent prices have escalated so rapidly, it has been difficult to keep track of what the current market price may be. I have considered incorporating some sort of rent bidding in my process, or adding a wait list for upcoming vacancies, and setting the rental price at the time that it becomes vacant. Neither of those strategies maps well to posting a vacancy on a listing site, where you have to have a set rental price at the time of posting.

Don,

MANY posts here about rent increases. Try the Search feature.

My thoughts:

-check the ads on Zillow, newspaper, etc

-study the Big Dog Apt complexes to compare. They have experts analyzing local rents.

-talk to LLs at your local association.

-look up your zip on HUD.gov, Sec8 rents

-NEVER believe any number from Zillow. I closed a house for $165k and a week later the Zestimate was $150k.

My lease is clear: automatically renews with a 2.9% Cost of Living increase. New resident actually LIKE this clause - no surprises.

My reminder letter uses the technique Jeffrey teaches “If you feel you cannot afford this please write your suggested increase here____. “

We held off during the first pamdemic to avoid bad press. After several months I decided “long enough. “

We mailed 64 increase letters with a copy of the lease clause they initialed at signing.

Only 2 people asked for a discount. I knocked off $5 or $10 and they were happy.

Don’t be timid. Renters EXPECT increases.

And rest on the fact the MARKET SETS THE RENT, not you.

Don,

MANY posts here about rent increases. Try the Search feature.

My thoughts:

-check the ads on Zillow, newspaper, etc

-study the Big Dog Apt complexes to compare. They have experts analyzing local rents.

-talk to LLs at your local association.

-look up your zip on HUD.gov, Sec8 rents

-NEVER believe any number from Zillow. I closed a house for $165k and a week later the Zestimate was $150k.

My lease is clear: automatically renews with a 2.9% Cost of Living increase. New resident actually LIKE this clause - no surprises.

My reminder letter uses the technique Jeffrey teaches “If you feel you cannot afford this please write your suggested increase here____. “

We held off during the first pamdemic to avoid bad press. After several months I decided “long enough. “

We mailed 64 increase letters with a copy of the lease clause they initialed at signing.

Only 2 people asked for a discount. I knocked off $5 or $10 and they were happy.

Don’t be timid. Renters EXPECT increases.

And rest on the fact the MARKET SETS THE RENT, not you.

Another…post it on CL or Zillow at a courageously high price and watch the responses. You’ll be surprised.

You can always reduce it or give a discount.

I just had one come open. Set 295/mo higher than the last one. I'm getting a pretty good response from it. My current renters noticed... their jaws dropped and eyes popped. I warned them... if I get rented, look for some big rent increases. Most will pay; but those on SSI and no other retirement funds are scared like crazy. I have already told them to start looking at other avenues for housing.

Don,

I concur with what you are saying but not necessarily the timing. Your timing might be awesome for your area. It might not fit so well in my area.

I am in an area where we get Lake Effect Snow. For me, the best month to have rates go into effect is Feb and March. This allows me some time to get a unit ready to market just before the onslaught of the Spring buying rush.