Skyrocketing rents (by LisaFL [FL]) Jan 23, 2022 11:53 AM|
Skyrocketing rents (by JB [OR]) Jan 23, 2022 12:24 PM
Skyrocketing rents (by WL [CA]) Jan 23, 2022 12:26 PM
Skyrocketing rents (by Oregon Woodsmoke [ID]) Jan 23, 2022 1:00 PM
Skyrocketing rents (by Oregon Woodsmoke [ID]) Jan 23, 2022 1:16 PM
Skyrocketing rents (by Oregon Woodsmoke [ID]) Jan 23, 2022 1:20 PM
Skyrocketing rents (by Robert J [CA]) Jan 23, 2022 1:47 PM
Skyrocketing rents (by WL [CA]) Jan 23, 2022 2:00 PM
Skyrocketing rents (by Roy [AL]) Jan 23, 2022 2:15 PM
Skyrocketing rents (by Homer [TX]) Jan 23, 2022 2:27 PM
Skyrocketing rents (by zero [IN]) Jan 23, 2022 2:41 PM
Skyrocketing rents (by pete [OR]) Jan 23, 2022 3:56 PM
Skyrocketing rents (by Sisco [MO]) Jan 23, 2022 4:27 PM
Skyrocketing rents (by S i d [MO]) Jan 23, 2022 6:39 PM
Skyrocketing rents (by Roy [AL]) Jan 23, 2022 7:04 PM
Skyrocketing rents (by LisaFL [FL]) Jan 23, 2022 8:47 PM
Skyrocketing rents (by Sisco [MO]) Jan 23, 2022 10:00 PM
Skyrocketing rents (by S i d [MO]) Jan 24, 2022 7:17 AM
Skyrocketing rents (by S i d [MO]) Jan 24, 2022 7:37 AM
Skyrocketing rents (by Roy [AL]) Jan 24, 2022 8:42 AM
Skyrocketing rents (by LisaFL [FL]) Jan 24, 2022 12:02 PM
Skyrocketing rents (by Sisco [MO]) Jan 24, 2022 12:27 PM
Skyrocketing rents (by Al [MO]) Jan 24, 2022 12:38 PM
Skyrocketing rents (by LisaFL [FL]) Jan 24, 2022 12:39 PM
Skyrocketing rents (by Wilma [PA]) Jan 24, 2022 2:11 PM
Skyrocketing rents (by Pmh [TX]) Jan 24, 2022 3:21 PM
Skyrocketing rents (by Robin [FL]) Jan 24, 2022 3:26 PM
Skyrocketing rents (by Sisco [MO]) Jan 24, 2022 6:40 PM
Skyrocketing rents (by LisaFL [FL]) Jan 24, 2022 7:15 PM
Skyrocketing rents (by 6x6 [TN]) Jan 24, 2022 8:50 PM
Skyrocketing rents (by LisaFL [FL]) Jan 24, 2022 10:58 PM
Skyrocketing rents (by JB [OR]) Jan 25, 2022 1:55 AM
Skyrocketing rents (by Phil [OR]) Jan 25, 2022 8:02 AM
Skyrocketing rents (by Sue [IN]) Jan 26, 2022 3:07 PM
Skyrocketing rents (by Rich [PA]) Jan 27, 2022 5:55 PM
Skyrocketing rents (by D [IN]) Jan 28, 2022 3:09 AM
Skyrocketing rents (by Sue [IN]) Jan 28, 2022 11:39 AM
Skyrocketing rents (by LisaFL [FL]) Posted on: Jan 23, 2022 11:53 AM
This is a question for those who are in areaís with skyrocketing rents and housing prices. My area in Florida is just crazy.
How are you handling this market rent increase for your existing tenants? I was already below market on mine, now Iím ridiculously below market. What would you do? I just increased rents across the board higher than I ever have before 6%-10%. But still, Iím way below market. I hear so many stories from tenants whose rents have increased by $400, $500 or $600 to bring them up to current market levels.
I have another renewal approaching. Market rent is $2000. Current rent is $1200. Current tenants are anyoneís dream tenants who have been with me since 2015.
What would you consider to be fair/generous?
I do have a hard time causing good people who have made my life easier and contributed to my success to struggle. So Iím just curious what others would be inclined to do in these situations. I realize it is a business but there is a human factor involved that is hard to ignore. --24.96.xx.xxx
Skyrocketing rents (by JB [OR]) Posted on: Jan 23, 2022 12:24 PM
I don't believe it's right to hammer great tenants with huge increases just because they are (un)lucky enough to be in an area where rents are blowing up. At some point, you must ask yourself do I need this much more money than some good folks need a place to live. I let my conscious guide my increases.
For great people, I'm likely to never go higher than two or three hundred at once. --73.25.xx.xxx
Skyrocketing rents (by WL [CA]) Posted on: Jan 23, 2022 12:26 PM
I am thinking of going to one year fixed term rental agreements. T moves out after one year then the rent goes up to market. Also avoids rent control in CA. Just rented a 2 bedroom last year and the comparable rent on Craigslist is up $200 from last year. Unofficial inflation per Shadowstats is 15 percent, so long term leases don't pay. Short term leases allow quick adjustment for inflation. --174.65.x.xxx
Skyrocketing rents (by Oregon Woodsmoke [ID]) Posted on: Jan 23, 2022 1:00 PM
My good tenants stuck with me through Covid, paying their rent on time and being pleasant o deal with. So, I am going to stick by them through the rent increases.
They will have to pay a rent increase at renewal, but not up to market rate. I don't want them to leave, especially not in this crazy market with so many losers trying to trick their way into rentals.
But they do get an increases, mostly because I am worried about the very serious possibility of national rent control. --76.178.xxx.xxx
Skyrocketing rents (by Oregon Woodsmoke [ID]) Posted on: Jan 23, 2022 1:16 PM
Mine were all at highest market rent when they moved in, just before Covid. I didn't raise rent the first year because we were all in a Covid mess nationwide. Plus I don't generally raise rent the first renewal.
Now rents have skyrocketed so they are all far below market, but I will bring them up in smaller steps, hoping to not lose them. I know I would get a lot higher rent if I get new tenants, but I don't want to go through the screening and application process right now.
If I go with the official government rate of inflation, that looks about right to me as an amount to raise their rent. (the official rate, not what I have to pay for everything around me which is about 5X the official government rate) --76.178.xxx.xxx
Skyrocketing rents (by Oregon Woodsmoke [ID]) Posted on: Jan 23, 2022 1:20 PM
Adding this, if a tenant had given me even the slightest bit of trouble, I would be less merciful.
But my houses look like the cover of a home beautiful magazine with their perfectly manicured front yards. The interiors are spotless, rent is early, and tenants are absolutely lovely to deal with. That's worth quite a lot to me and it is worth getting a bit below market rate to keep them all.
So rent raise will be about 7% this year. I know the tenants won't be happy with it, but I also know they won't be able to afford to move. --76.178.xxx.xxx
Skyrocketing rents (by Robert J [CA]) Posted on: Jan 23, 2022 1:47 PM
Over three quarters of my rentals are in Rent Controlled area of the Los Angeles area, so I am screwed! With Covid restrictions, there are no rent increases or eviction for non-payment of rent.
Skyrocketing rents (by WL [CA]) Posted on: Jan 23, 2022 2:00 PM
Offhand, the only way LA LLs can lower their expenses during a moratorium is to install solar - to cut back on their utility costs. This shouldn't be considered a reduction of service since there is still hot water if you are stuck paying for T hot water.
Just finishing evicting a moratorium no pay as of Feb 4th and the one good thing was I didn't pay any of his utilities - no monthly out of pocket expense. C Class apartments in the hood are deadbeatland and I installed separate water meters years ago. Let he local electric and water companies go after the deadbeats for their utilities usage and not me. --174.65.x.xxx
Skyrocketing rents (by Roy [AL]) Posted on: Jan 23, 2022 2:15 PM
My yearly rent increases go out in late February or early March. I have been thinking the same thing you have. Last year, everyone got a $25.00/month increase. Now I am thinking about $35-$50 range.
However, with increasing rents, you can only increase to the point of "what the market will bear". And what happens when your tenants tell you they can't afford your rent increase,...are you going to evict them if they don't pay it? --71.207.xxx.x
Skyrocketing rents (by Homer [TX]) Posted on: Jan 23, 2022 2:27 PM
My tenants know I send out increases each April. Our county announces new values each April 1. I sent letters in December letting them know that they may see $150-250 increases, which depends on how much our expenses go up. I told them to be prepared and if they donít think they can afford the increase, it may be best to start looking now. I only felt it was fair to warn them of what was coming. Honestly I would feel bad if I raised it by $250 with only a months notice. I doubt anyone will move as prices are stupid high here, houses I was renting for $925 when I started 19 years ago are now at $1800-2100. --66.169.xxx.xxx
Skyrocketing rents (by zero [IN]) Posted on: Jan 23, 2022 2:41 PM
Just printed off rent increase notices for the first time.
Have six places I will be hitting, and only for small amounts. Looks like the 4% range, with a statement that this will be at least 3% annual increase.
Still puts them below market, but shouldn't scare any of them away. I am ready for the push back tho. I have a list started of prospective tenants and it seems to be growing weekly.
Hate to admit it but I have a tenant who has been with us for 16 years and never got an increase. Anyone more than 2 years is getting bumped.
Next year it will be everyone with at least one year. Was going to make them sign new leases, which are all MTM, but figured I would do that the next round.
Reading on this site has opened my eyes a bit on the money left on the table.
Much smaller amounts than most on here are getting, but a pretty small county I am in as well. --107.147.xx.xxx
Skyrocketing rents (by pete [OR]) Posted on: Jan 23, 2022 3:56 PM
I am raising rent 7.5% until it reaches market rate. This will take 2 to 3 years with no inflation. I will see next November, how the market looks. It's hard since I have a great tenant. --35.132.xxx.xxx
Skyrocketing rents (by Sisco [MO]) Posted on: Jan 23, 2022 4:27 PM
Set your rents at the top of market price at turnover. Raise your rents to top of market at lease renewal.
Stop using terms like hammering your good tenants, rents are rising because the cost of everything needed to maintain a house is rising, you will have higher expenses than income if you fail to raise your rents. You will go out of business, Your good tenants will then move into a market price house. --149.76.xxx.xxx
Skyrocketing rents (by S i d [MO]) Posted on: Jan 23, 2022 6:39 PM
Your groceries are priced at market.
Your gasoline is priced at market.
Your clothing is priced at market.
Your construction materials are priced at market.
Your insurance is priced at market.
Your (insert any business or Govt entity) is priced at market.
Why would you NOT price your rentals at market? Are you the exception to 10,000 other rules? If so....why?
Skyrocketing rents (by Roy [AL]) Posted on: Jan 23, 2022 7:04 PM
Great reply there my friend! However, I wonder how many LL's actually know what market rent is or even how to determine it?
In my market area, I do 'rent surveys' where I ask other tenants who rent houses near mine what they are paying in rent. Sometimes I will ask the LL if I know him/her well enough to ask a personal question about his rents. I use this information to determine my asking rent, which is always $100.00 more than what my competition is getting. I take pride in knowing I am the highest paid LL on that block or neighborhood.
Skyrocketing rents (by LisaFL [FL]) Posted on: Jan 23, 2022 8:47 PM
I donít think itís that simple or straightforward. And of course it depends on what youíre looking to achieve. And contrary to Siscoís suggestion, not raising to market rent is not going to cause me to go out of business. It may cause someone else to go out of business, but not me.
If you are out to make as much as you possibly can or if that is what you need to do to survive, then certainly raising rents by hundreds of dollars a month to market rates is the right answer for you.
My goal is to keep the tenants I have. I donít want to deal with new, unproven people.
Mine have done nothing but make my life easier and have contributed to my success. The peace of mind they have given me is invaluable. Because of them I have kept my properties probably longer than I otherwise would have and as such now I am reaping the benefits of this unusual and astronomical increase in prices and rents.
So I am willing to give back to them by not increasing to current market rents because I can. If I couldnít, or if I wasnít keeping up with my cost increases that would be different.
Maybe my market isnít what youíre used to. I used to increase rents by 2%-3% a year. But our rents in the past few years have been through the roof. This year my increases were 6%-10% but even at that rate Iím no longer close to market rents.
If I were to increase my $1200 a month six year tenant to market rent of $2000, the increase would be a 66.66% increase. That just seems unconscionable to me to do to these people. So just because I can, it doesnít seem right.
I will probably do a 12.5% increase and bump them to $1350.00. And I will let them know to expect a similar increase next time.
These are dream tenants. Very good people with two wonderful boys, one of whom is disabled (born with cerebral palsy). They would never find anything remotely similar or affordable for them near their special needs childís school like the house they are in. I have had the neighbors tell me they hope they never move because they are the best neighbors you could ever want.
So as far as bumping them to market rent level, I just would never feel good about myself again if I did that. --24.96.xx.xxx
Skyrocketing rents (by Sisco [MO]) Posted on: Jan 23, 2022 10:00 PM
Lisa, you asked what amount of increase is fair. Market rate is fair. --149.76.xxx.xxx
Skyrocketing rents (by S i d [MO]) Posted on: Jan 24, 2022 7:17 AM
What Sisco said. It's not unconscionable. It's also much simpler than you think it is. Unfortunately, I think someone or something has made you feel guilty about your successful investment. Maybe one of those shrieking politicians who cries about "fairness" while they live in gated communities in multimillion dollar mansions?
Or is it inertia? Are you stuck in a rut and fear change? I'm hearing phrases like "dream tenants." My definition of a dream tenant does not include someone only willing and able to pay 60% of what anyone else would pay. You'd never allow that for a new tenant, but perhaps fear of change has you stuck. I'm not sure. There are hundreds if not thousands of dream tenants in your city who would pay you market rate. These folks are not the only dream tenants.
Look at it this way: other landlords are charging their tenants the rates you're afraid or unwilling to charge. By definition, they are setting the market because that is what they are asking and their tenants agree to pay it. So what's the deal? Are those landlords all unconscionable? Are their tenants dupes and fools?
One last attempt: if your house were empty, what would you rent it for to "unproven" tenants? Why would that be the correct decision?
Your house; your rules. You asked for an opinion, so here it is: market rent is fair and reasonable.
Skyrocketing rents (by S i d [MO]) Posted on: Jan 24, 2022 7:37 AM
Roy, market price in a free market is always in a constant state of discovery. Today item X costs $10. Tomorrow it make cost $10.50 or $11....or $9. LisaFL told us what market rent is, and I've got no better metric. You'll need to ask her how she came up with $2000.
When I have a vacancy, I get on Zillow and look at comps. Then I price myself right in the middle. There's not a lot of variation between high and low...maybe a $50 difference? I'm usually rented within a week, so I would say I'm pretty close to spot on...might be a little too cheap, but not 40% too cheap.
I also have a saved search list in Zillow for houses similar to mine, so about once a week I get an email with 6-8 rentals that meet that criteria. This helps me keep track of where rents are. --108.230.xxx.xx
Skyrocketing rents (by Roy [AL]) Posted on: Jan 24, 2022 8:42 AM
Inside my head, I make a distinction between rents for houses based on their respective amenities. For example, if a house has Central Heat/Air which can produce costly service calls and replacement cost, I tend to charge more rent as opposed to a no-frills house which only has space heaters and window a/c units. In the past, houses with Central H/A had to rent for a min. of $600.00/month, however, NOW that same house needs to rent for $700.00/month. My 'no-frills' houses use to rent for $500.00/month but now $600.00 is becoming the new norm.
From experience, I know tenants will pay more rent for Central Heat/Air but 'how much more' depends on the market conditions at the time. They will also pay more for an extra bedroom and/or extra bath too so those factors come into play.
Do you do anything similar to this with your Class C or D houses? --71.207.xxx.x
Skyrocketing rents (by LisaFL [FL]) Posted on: Jan 24, 2022 12:02 PM
I completely agree that yours and Sids opinions are not unconscionable and certainly valid. There is never one right or wrong way.
I do have an inclination to be very charitable to tenants who have been good to me. I donít necessarily think thatís a bad thing either unless it was affecting my business, which it isnít.
Just because you can do something doesnít always mean you should. I like helping other succeed and just because Iím completely justified to squeeze every penny out of them doesnít mean it is the best choice.
And I have many good tenants but I would not call them all dream tenants. These are dream tenants. Eat off the floor tenants. Tenants who had to wait two weeks the August after Covid in Florida to have their air conditioning replaced who apologized to me for having to stress over it, who completely understood the supply chain issue was beyond my control, who refused to take any compensation because they knew it was already costing me to replace it. Tenants who bought themselves a couple portable units to get by with, refused payment and offered them to me for other tenants if I ever needed them.
So yes, my inclination is to be charitable towards them.
I know I am within my rights to charge market rates but the increase in our market in just a couple of years borders on unconscionable.
So my question was more designed to get an idea of how other landlords would handle a similar situation. It seems there are varying opinions and they are all valid. We all have different goals and varying levels of wealth. So yes, I do ask myself is it more important for me to die with another million dollars for the government to take 40% of or is my money better spent helping good people while Iím alive who have contributed to my success. --24.96.xx.xxx
Skyrocketing rents (by Sisco [MO]) Posted on: Jan 24, 2022 12:27 PM
Lisa, you are mistaken if you think that undercharging tenants is virtuous. It is no more virtuous than burning $100 bills.
Market rate tenants are more apt to keep a clean house than are tenants receiving a charitable donation from their LL.
Skyrocketing rents (by Al [MO]) Posted on: Jan 24, 2022 12:38 PM
I agree with Lisa. You donít need to get top dollar all the time. I seek excellent tenants, which for me are those that pay the rent every month, albeit sometimes a little late, but who pay without me having to chase them and post notices; tenants who look after the house and landscaping and donít call me for every little thing; tenants who let me have access to the property whenever I want to to get non urgent maintenance taken care of at a time of my choosing; tenants that have paid in full all the way through the Covid pandemic. Respect on both sides goes a long way. You donít find or keep that type of tenant by always demanding top dollar and being the heavy handed landlord. You also are leaving money on the table by being too generous, and asking for trouble by being too lenient, but there is a sweet spot middle ground that makes life so.much more pleasant for all concerned. Who wants to spend their life fretting over poor tenants, posting notices to pay, evictions, dealing with constant turnovers. Get good long term tenants and make a healthy profit, donít try to extract every last dollar, itís a fools errand. --97.86.xxx.xxx
Skyrocketing rents (by LisaFL [FL]) Posted on: Jan 24, 2022 12:39 PM
Iíve been a landlord since 1986 with 40 homes at one point so Iíve been through a lot of tenants.
I can unequivocally say you are wrong on that opinion. Whether rent is at market rate or not has no bearing on how clean a tenant keeps it.
Some people are meticulous when it comes to keeping their house. Itís their nature and not related to how high or low their rent is.
As I stated, these people are eat off the floors clean.
The same people who told me that they changed their AC filter every month but the AC may not be working right because it is never dirty. So I told them to check it every three months and report back. More of the same. The issue, when you have no dirt or dust in your house, your AC filter doesnít get dirty.
About 75% my tenants are similar. I pinch myself sometimes over how lucky I am to be able to pick quality tenants. And all my rents are below market. --24.96.xx.xxx
Skyrocketing rents (by Wilma [PA]) Posted on: Jan 24, 2022 2:11 PM
We just had a nearly identical situation. We gave it a lot of thought, and decided to try Jeffrey's "what do you suggest?" letter. (Actually, all done by email.) Our tenant did his own research first, then got back to us, expressing his shock over where rents had gone.
We told him that we were not looking for meeting what the current past two years' market rent is/was (a severe housing shortage has made everyone jack up prices astronomically, but it's already showing signs of declining). We instead chose a number about $200 higher than he was paying, citing the facts that: he has been good, steady, and understanding over the number of years he has been there; costs to us have been rising over the period of time since his last rent amount was settled; and the mitigating fact that the rental needs cosmetic upgrading so we wouldn't expect to go above slightly below the median rent from 2019, which our proposed amount represented. We then asked if that amount would be a hardship.
He expressed relief, said that it was not a hardship, and that he would not need to consider moving like he would have had we raised the amount to be closer to the current market. He felt heard and understood, and we kept a valued tenant for a while longer!
Skyrocketing rents (by Pmh [TX]) Posted on: Jan 24, 2022 3:21 PM
Roy. Not sure why you need to ask anyone anything. just go on line to see whatís being advertised & at what prices. do you really think other LL or tenants give you a straight answer (?) asking for a friend. --107.77.xxx.xxx
Skyrocketing rents (by Robin [FL]) Posted on: Jan 24, 2022 3:26 PM
My rental is in central FL and since my tenants have been there since 2010, the rent is way under market. Nearly $400 under. But they paid the rent through the covid moratorium and they keep their word as to the date they can pay the rent when they are going to be late. They pay the late fees with no argument.
I am giving some thought to either terminating their tenancy and moving back in the house when the lease expires or raising the rent by at least $200.00. The reason for this thought process is that I am being transferred to a new project in a couple of months and the house is closer to the new job than my current residence (thus less traffic frustration). But if they are willing to pay $200 more in rent, then that will bring their rent closer to market rate plus go a long way to ease the discomfort of 5 o'clock central Florida traffic. --198.136.xxx.xxx
Skyrocketing rents (by Sisco [MO]) Posted on: Jan 24, 2022 6:40 PM
Lisa, you asked about fair amount of rent increase. Why would you ask?
You are rock solid on all the benefits of pricing well below market rates has provided you over these past 36 years.
Why did I answer? --149.76.xxx.xxx
Skyrocketing rents (by LisaFL [FL]) Posted on: Jan 24, 2022 7:15 PM
I respect all opinions and donít feel one is more right then another but situationally dependent. I appreciate learning other viewpoints as they may add insights that I missed or hadnít considered.
For instance in this case I believe I need to become even more aggressive with increases when it comes to longer term folks who Iíve allowed to fall too far behind.
Our particular market has just been somewhat of anomaly these past couple of years which have virtually caused rents to almost double from what they were just a couple of years ago.
Itís to the point where someone who was well qualified when they were approved would not be qualified if rates were adjusted to the new market rates. So I wanted to get some opinions as to how others might address this for tenants they wanted to keep- what they felt was a fair compromise to both sides of the relationship.
In my case, I donít need the money so I have more flexibility to exchange less income for the security of keeping tenants I want to keep. But at the same time I want to be fair to myself as well - as in I can be charitable but not to the point of being a fool.
I absolutely agree that there is nothing unfair about setting your rent to match the market. But there is also nothing wrong with accepting less, providing your personal situation allows it, to allow quality tenants you want to keep the ability to stay.
I very much value you input. --24.96.xx.xxx
Skyrocketing rents (by 6x6 [TN]) Posted on: Jan 24, 2022 8:50 PM
I wonder if they have received any big raises from work and how much it is? That might guide your answer. --73.120.xx.xxx
Skyrocketing rents (by LisaFL [FL]) Posted on: Jan 24, 2022 10:58 PM
Very I insightful of you! I actually have another tenant due for an increase I was dreading. However I was privy to the fact she had just received a 5% pay raise so I raised the rent to give her just a little left over after the increase.
This particular tenant is also a keeper but she is barely at the income level for her rental to be affordable. So far so good and sheís managed to always pay on time. Iím willing to be charitable to a point but only to a point. I want her to succeed but single parents do have a tougher time of things, so while I wonít ever let a tenantís problem become my problem, I can still empathize.
I know I have many grateful tenants but I know I have one who doesnít appreciate what heís got, in the end he only will hurt himself. I know itís a business but the human factor is still there. My charitable nature doesnít extend to ungrateful or difficult tenants. Fortunately for me those have been few. --24.96.xx.xxx
Skyrocketing rents (by JB [OR]) Posted on: Jan 25, 2022 1:55 AM
Another thing I consider: anytime I have tenants paying the rent themselves instead of some govt entity (using my own tax dollars) paying me my own rent, I consider myself (and society) much better off. --73.25.xx.xxx
Skyrocketing rents (by Phil [OR]) Posted on: Jan 25, 2022 8:02 AM
Roy- and most others--- you are working too hard at this. You pay tax dollars to the Federal Government to do all this research. Why don't you use it? Google "HUD Fair Market Rent" Put in your state- pick your county or metro area and you will see what Fair Market Rent sometimes down to a particular zip code.
Rents need to be able to cover PITI,vacancy,maintenance,managementfee ..... The cost to build is high, so rents are going up. Think in terms of " If I had to buy my rental today, what would I have to charge for rent?" Forget how much you paid for it or how much you owe on it. How much is it worth today? --73.11.xx.xx
Skyrocketing rents (by Sue [IN]) Posted on: Jan 26, 2022 3:07 PM
Property taxes were just doubled on all my rentals because of all the new housing in the area. My long term tenants are now retired and on fixed income. The more I increase the rent or make the property nicer the higher the assessment on the property goes and the higher the property taxes become and landlords pay twice as much in property taxes as owner occupied properties and owner occupied properties get all kinds of exemptions while rentals get none. This is a State Level problem with no controls as to how much an assessment can jump in any year. Elected State Officials can't figure out why there's no affordable housing. They are going to form a task force this summer to study the issue. Decent, Safe, Affordable housing is as elusive as the Unicorn.
As properties become vacated I raise the rent. I determine rent based on what I can get if renting to Section 8. --71.46.xxx.xxx
Skyrocketing rents (by Rich [PA]) Posted on: Jan 27, 2022 5:55 PM
Many of my costs go up every year. Case in point, Waste Mgmt raised their prices 20 percent this year on my multi-unit garbage pickups...I did talk their prices down to about a 5% annual increase.
However, there is one cost that stays steady and eventually is reduced to zero. It has always been my largest expense item each year and that is the building mortgages. With that in mind, my overall landlord inflation rate is typically around 2% per year. This is the amount of rent increase I raise my rents each year ($10 - 20 per year). When tenants' move out, I then reset the rate to market value.
Listening to the debate above, I find this strategy keeps tenants relatively happy with predictable rent increases and keeps my rent at or only slightly lower then market price.
Now that the mortgages are paid in full, I make plenty of $$ without the need to squeeze each tenant for every dollar. --98.111.xxx.xxx
Skyrocketing rents (by D [IN]) Posted on: Jan 28, 2022 3:09 AM
I'm not hearing about the cost of repairs when a tenant moves out, which can negate the market rate increase. For me, whenever a long-term tenant moves out there tends to be significant maintenance and repair costs we incur, plus the cost of any upgrades we choose to include. The work time to complete usually costs us a months rent too. As such, it's been my experience that it's cheaper to retain a tenant, even at a lower than market rate (still increasing them some annually) then having them move out and spending all the increase to market rate, and more, in repair costs. It usually takes us 8 - 12 months of steady rent, per property, to recoup the cost of a long-term tenant moving out. However, when tenants choose to move, we up the property to market rate before re-renting. --69.118.xxx.xx
Skyrocketing rents (by Sue [IN]) Posted on: Jan 28, 2022 11:39 AM
D IN - I'm with you on retaining long term tenants. I retained my long term, now fixed income tenant. I repainted dark wood paneling in bright colors, put laminate down on old pink & black tile kitchen floor, replace kitchen florescent light fixture, replaced broken appliances with working used ones and added roll around breakfast bar made from used base cabinet with wheels and butcher block counter top while tenant continued to live there and pay rent. These were all things I would have had to do for new tenant and I didn't lose any rental income while doing these repairs. The bright paint helped her mental attitude and she's planning on staying another 10 years. --71.46.xxx.xxx