Though you may not like the idea of doing this, and your tenants will certainly not marvel at this prospect, there comes a time when you have to raise the rent in your rental property. In fact, raising rent is almost as difficult as asking for a pay increment from your boss. The only difference between asking for a pay rise and raising rent is that you need to justify the pay raise while no justification is required for a rent increase. Many factors may necessitate a rent increase.
Some of the reasons may include:
- Increasing taxes
- High insurance premiums
- Inflation of maintenance expenses
- Increase in homeowner association fees
- Increased cost of living
As Keyrenter property management in Fairfield, we understand that raising the rent in your units needs a good blend of business skills, public relations with your tenants, thorough market research, and legal requirements. These are all an essential part of real estate. Generally, raising rent may seem like an easy task on the surface, but it can result in loss of tenants and money if not done professionally.
Raising the rent can be a nightmare even to experienced landlords, but with Keyrenter property management on your side, you can be sure to get it right and avoid losing your tenants. With more than 10 years of experience in property management, we understand the need to achieve a mutually beneficial setting between our customers and their tenants. If you want to raise the rent, we can help you do it and make sure that you keep your tenants as well.
Determining the new rent for your tenants
Before we increase rent on your tenants, we first ensure that the increase makes sense. We carry out a research by examining the current rent prices in your area for condos, family homes, or apartments that are similar to yours. We do not just use a single area to determine the rent increase; we also research on various rental locations and ensure that we are comparing units that are similar to yours in terms of amenities available, size, and location. When we raise the rent to match the average prices in the area where your units are located, your tenants will feel that they still got a better deal, thus they will not move out.
We use the following tips to determine the new rent to charge your tenants:
- Look at units that closely match yours in terms of the number of bedrooms, bathrooms, square units, and parking space, among other similarities.
- Look for units with almost the same age as your units with a few years range
- Research on rental properties that match yours in terms of structure and style; like a single family, condo, multi-unity, or apartments
- Compare rental properties with a similar visual appearance as yours, landscaping and outdoor features like pools and swing set, among others.
In this way, we are able to establish the accurate market rate for rental property such as yours.
Give Your Tenants Notice
We all know that a rental increase is never good news to any tenant. As such, we make sure that we give your tenants a notice of the increase to make sure that they have adequate time to adjust to the new price. Most landlords usually give a one-month notice prior to raising the rent; however, you may want to opt for a two-month notice. This notice will enable your tenants to get used to the notion of paying a higher rent in the coming months. Besides the notice, you may also send a reminder several days before the new rent price takes effect to remind them of the raised price. For those on a lease, you will let them know that the raised rent will be effective once they renew the lease.
Consider an Incentive
It is no doubt that only a few landlords will consider rewarding tenants for staying on after a rent increase. We believe that rewarding your tenants will help ease the rent increase pain. For instance, you can offer an incentive like professional carpet cleaning for their carpets or upgrade some of the appliances after you have raised the rent. This will show that you care about them and may act as a justification for increasing the rent.
Answer the Questions Asked
When you raise the rent, tenants will certainly have many questions about why you decided to increase the rent. You do not have to give them all the details, but you can tell them that raising the rent helps you pay for services like those mentioned above as well as offer the same quality maintenance you have always given them.
Let Someone Help You Raise Rent
If you do not like the idea of facing your tenants to raise the rent, then you can have someone help you with it. Luckily, working with us can make this quite an easy task for you. As a property management firm in Fairfield, we can help you manage your rental property to ensure that you maximize the value of your investment. Our services will include rent collection and notifying your tenants about rent increments in a professional way.
The Red Flags in Raising the Rent
In case you are planning to raise your rent, it is important to make sure that you are doing it the right way and for the right reasons. You can document the reasons to avoid a future conflict with your tenants or leases.
Here are some of the common red flags associated with rent increments:
Some property owners are tempted to increase rental prices discriminately. For instance, they increase the rent based on a tenants’ national origin, gender, religion, family status, or disability among others. At Keyrenter, we always ensure that your rent increase is moderate and not connected to any form of discrimination in order to force your tenant out of your property.
Increasing rent for retaliation purposes may take place when a property owner raises the rent to evict a tenant for exercising his or her rights. Rent increase cannot be a retaliation move against a tenant for demanding repairs and maintenance or reporting you for building code violation in your rental property.
It is your right as a real estate investor to make money from your condos, apartments, single-family units, and duplexes by setting the right rental prices. As a property management firm in Fairfield, we provide property management services to landlords around Fairfield and we can help you increase the rent in your property without paining or losing your tenants. Our main goal is to see you profit from your rental property.