Here at the beginning of the year it is a good time to start to think about raising rents. Tenants will always dislike a rent increase (who wouldn’t?), but following a few rules of etiquette can keep the process as seamless and stress free as possible.
- Be consistent. Analyze your rent against the market rate annually (we would be happy to help you with this!) and make small adjustments each year to keep your rates current. Tenants will be less likely to argue about it if it’s a small amount that they can expect regularly. This is a key reason you cannot procrastinate and hold off increasing rent for a period of years.
- Give it time. Instead of the minimum thirty days notice required, consider providing 60 or 90 days. This will give the tenant ample time to prepare financially and even look around to see if he or she can find a better deal.
- Review the lease. Check your lease to see if you’ve covered anything about “lease renewal” or rent increases in an addendum.
- Avoid giving multiple tenants increases at the same time. This will prevent everyone getting angry at the same time, especially if you own a large building with ten or more units.
- Stay on top of maintenance. If you ask for a rent increase while getting behind on maintenance, your tenants are more likely to push back. Provide great service to your tenants, and they will be more understanding and gracious about the need to increase rents.