Rent increases (by Duplexer [IL]) Jun 9, 2023 2:23 PM|
Rent increases (by Jim in O C [CA]) Jun 9, 2023 2:31 PM
Rent increases (by jonny [NY]) Jun 9, 2023 3:51 PM
Rent increases (by Jason [VA]) Jun 9, 2023 4:41 PM
Rent increases (by plenty [MO]) Jun 9, 2023 4:53 PM
Rent increases (by zero [IN]) Jun 9, 2023 5:17 PM
Rent increases (by Sisco [MO]) Jun 9, 2023 8:11 PM
Rent increases (by Robert,OntarioCanada [ON]) Jun 10, 2023 2:37 AM
Rent increases (by DJ [VA]) Jun 10, 2023 7:47 AM
Rent increases (by Ed [CA]) Jun 10, 2023 2:12 PM
Rent increases (by zero [IN]) Jun 10, 2023 6:43 PM
Rent increases (by Duplexer [IL]) Posted on: Jun 9, 2023 2:23 PM
Costs have been increasing across the board as most of you already know.
We have a good renter in a studio who has been there several years and is up for renewal. They are renting about $65/mo less than we would relist the apartment if they moved. However we have found good renters who pay on time and cause no problems are hard to find, and it would be a ton of work to renovate & find a qualified replacement.
I am considering a $20/mo increase for the renewal year. Is this excessive, low, or just right? We've got to do something.
Also as far as lease renewals. What we do is stick a paper in their door which basically adds a lease addendum, extending it a year and states the new rental rate. Is this how others are doing it?
I've never raised rent on a tenant with a renewal "offer", but we tend to play musical chairs with the apartments, people coming and going enough it just hasn't been necessary.
Thanks for feedback.
Rent increases (by Jim in O C [CA]) Posted on: Jun 9, 2023 2:31 PM
Actually probably should be $40.00. I increase my rents 1 to 2 % annually because smart tenants realize my costs do increase. --67.169.xxx.xx
Rent increases (by jonny [NY]) Posted on: Jun 9, 2023 3:51 PM
Same as what Jim stated... I would raise 2-3% (round up or down as you see fit) annually. There are times that we do 5% but that's usually a bit harsh.
Sometimes (depending on the tenant) I may not increase the first year because I usually will bump the rent up and then as long as everything is "good" and my expenses didn't jump then I'll hold out. However, some tenants feel that when you don't increase they shouldn't be expected to pay later (I'm running into that now with one that we didn't increase last year because they were taking good care of the property and were actually mowing the lawn so we waived it but now the taxes and insurance are through the roof so we have to... not sure if they'll stay but if they don't then it will most likely be more than what we are offering them to rent it at now for sure).
I do letters... just stating that their lease is coming due on such and such date, we reviewed their tenancy and our costs and this is what we are offering....
Then we give them the choice of staying (accepting the offer) or leaving (not accepting) and give them a self addressed envelope to return their letter to us (we give them two copies... one for them to keep).
If they decide they are leaving we follow up with a "move out" letter. --69.201.xx.xxx
Rent increases (by Jason [VA]) Posted on: Jun 9, 2023 4:41 PM
I raise 4-5% for good tenants and 10% + for meh tenants --50.219.xxx.xxx
Rent increases (by plenty [MO]) Posted on: Jun 9, 2023 4:53 PM
My increases have been more like $100 --172.59.xxx.xx
Rent increases (by zero [IN]) Posted on: Jun 9, 2023 5:17 PM
Just started (last year) raising rents automatically. I put in my lease that it will be 3% minimum rounded to the nearest $5.
I send a letter to each person reminding them more than 30 days out.
Just got one back while I was at the convention. Forgot to put the apartment number on the mailing address. Just a duplex but they kicked it back anyhow.
Before I started doing this I never raised rents until someone moved. Costly move on my part. One tenant had been with me for 16 years before the first increase. Still didn't take him to market, but getting there. --107.147.xx.xxx
Rent increases (by Sisco [MO]) Posted on: Jun 9, 2023 8:11 PM
Donít be timid, set your rents to top of market. Look at it this way, the current tenants will pay money for moving expenses ,also moving is a lot of work and is a major hassle for them. If your rent amount is set to top of market rate, they wonít likely be able to find a less expensive, comparable home. --149.76.xxx.x
Rent increases (by Robert,OntarioCanada [ON]) Posted on: Jun 10, 2023 2:37 AM
There are two types of rentals which are tenants pay for utilities and other all inclusive where in the future the cost of utilities can go up significantly which puts you in a very bad position. One day the left wing bring in rent control where in a very difficult position. Rentals are not a investment where components of buildings require major replacement like a roof, plumbing, boilers, structural repairs, windows where need to have a reserve to do that. Start off with consumer price index where keep rents within line of that. --74.220.xxx.xxx
Rent increases (by DJ [VA]) Posted on: Jun 10, 2023 7:47 AM
It really depend on what the current rent is.
If the rent is $400/month, it might seem like a bit much, but if the rent is $1,000,
it may not be enough.
As others have said, use a percentage.
Here's another way to approach lease renewals: Put an automatic renewal at a minimum X% increase every year. Then you just assume they are staying & paying, and they don't need to comparison shop & decide. Unless they give you proper notice on their own. You might just send them a reminder of the new amount AFTER the time for them to give notice to non-renew has passed.
Check out Jeffrey's system of periodic communication through the year that includes "GOOD NEWS!" ; ) you'll be getting an anniversary gift as you begin your second year with us. There is a lot more more to it - check out his training.
The point is to not bring it to their attention that they may want to think about moving, and they have to make a decision. Entice them to stay longer. --68.229.xxx.xxx
Rent increases (by Ed [CA]) Posted on: Jun 10, 2023 2:12 PM
Based on what you've said, I'd probably do the $20 - $30 increase, but you are the only one who can really determine what to do.
If you raise it to full current move-in rates, what makes you think they wouldn't look around to see if they can rent a place for the same money that doesn't need the work that your place does?
It sounds like you're not looking forward to do the renovations, but do you plan to sell the place or renovate it at some point? What are your plans for the future of the property.
I like having a turnover every 6 - 8 years. Much longer than that and a place can start looking dumpy.
Rent increases (by zero [IN]) Posted on: Jun 10, 2023 6:43 PM
To me after 8 years it is gonna look dumpy inside no matter what. So why not keep them in there at close to market rents and not have to rehab or upgrade the place?
I admit I see the benefit of turnover as well, but maybe the situation should decide on which is best? --107.147.xx.xxx