U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Real Estate
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 09-15-2019, 11:05 PM
 
100 posts, read 59,223 times
Reputation: 140

Advertisements

I plan on increasing my tenants rent. How much do you think is a reasonable amount to increase at lease renewal but without scaring the tenant away? My tenant has been there for 4 years and their rent is below market. They have been paying their rent on time and maintain the house very well as if it were their own. Although the area isn't the best, the house has been completely updated before they moved in. They have central air, high-end stainless steel appliances, washer and dryer (which is a huge bonus), hardwood flooring, a nice size fully fenced in yard, an updated bath etc. In addition, I always quickly respond when they ask for repairs, and I always make sure repairs are completed promptly. The property taxes have went up substantially which is the reason why I would like to raise their rent. I was planning on increasing their monthly rent by $100, however I felt like this is a bit much considering they seem to be outgrowing the house as their family continues to grow, and I do not want to risk losing them as tenants any time soon. I don't want them to look elsewhere as it will just be more of a hassle for me to freshly repaint the house again and find a new tenant etc. After loking at the current available rentals on Zillow it seems that the other rentals are all basic and are not as nicely updated as my rental property and those rents are all priced higher. My question is, how much should I raise their rent? Should I raise them $50 or $75? I do not think this is considered to be a huge increase and I do not want it to be. I want to mention I usually never raise any of my tenants rent therefore I am a bit hesistant over the fact that they may vacate over this.. please provide all your opinions and suggestions as to what I should do. Thanks
Reply With Quote Quick reply to this message

 
Old 09-16-2019, 04:33 AM
 
Location: The Triad (NC)
29,154 posts, read 63,363,243 times
Reputation: 33468
Quote:
Originally Posted by possibleyou View Post
My tenant has been there for 4 years and their rent is below market.
I plan on increasing my tenants rent.
How much do you think is a reasonable amount to...
How far below market are you exactly?
Whatever that number might be is where the discussion starts.

The next set of questions are about what additional specific costs YOU have incurred...
that you feel you have a right to recover from your tenant.
Reply With Quote Quick reply to this message
 
Old 09-16-2019, 05:00 AM
 
2,257 posts, read 1,323,015 times
Reputation: 1929
At least the amount of the tax increase. Or give them a more substantial increase and let them go month to month.
Reply With Quote Quick reply to this message
 
Old 09-16-2019, 05:13 AM
 
Location: NC
6,722 posts, read 8,269,763 times
Reputation: 14008
5% is a reasonable increase. The fact that it is a nice place has nothing to do with it. That was taken into account when you first renter to them.
Reply With Quote Quick reply to this message
 
Old 09-16-2019, 06:35 AM
 
Location: East of Seattle since 1992, originally from SF Bay Area
30,546 posts, read 55,589,687 times
Reputation: 32320
It's hard to justify and explain to the tenants a flat dollar amount increase such as $100. The Consumer Price Index for your area is a good place to start. Ours seems to be at about 3.5% lately, I would calculate a CPI % increase and see if it comes out close to covering the tax increase. If not, you could then an amount to cover that. If you are still below market be sure to mention that when you announce the increase.
Reply With Quote Quick reply to this message
 
Old 09-16-2019, 07:26 AM
 
Location: Jacksonville, FL (Mandarin)
2,406 posts, read 5,334,906 times
Reputation: 1544
How much rent are you losing each month compared to what the property could easily and reasonably rent for, if they move out? Consider that monthly amount over a 4year period, and that’s what you’ve lost by keeping rent below market. It’s great they’re taking good care of the place, and that’s a benefit to you. But, you have to remember they’re simply doing what’s expected of them. They probably don’t care what your expenses are, and they’ll move as soon as they no longer need to live there. They have no loyalty to you and no obligation beyond the lease term. If market rent is $200/month higher than their current rent, and you’re confident you can get that from a new tenant, then you raise the rent on the current tenant by $200/mo and include a note that explains in simple terms why you made that decision. They’ll think about it and make the decision that best suits their needs.
Reply With Quote Quick reply to this message
 
Old 09-16-2019, 09:02 AM
 
2,352 posts, read 1,628,738 times
Reputation: 3048
We were in similar situation recently where we had same tenants for 4 years, really good people but rent in our market has gone up. I made a thread in this forum asking how common it was for landlord not to increase rent in last 3-4 years and most seem to have increased due to market change in last few years.


I still feel $100 is too much to increase at one go, the number just sounds like a lot. Again I don't know your area and how much you are renting for. I always go for $50 but if you are significantly below market price maybe go for $75. Or you can do what my husband did, he asked our tenant "what you think about raising the rent a little bit, the tax has been going up?" and the tenant answered "I think we can do $50, I will talk to my wife".
Reply With Quote Quick reply to this message
 
Old 09-16-2019, 09:08 AM
 
Location: NE Mississippi
14,189 posts, read 8,867,186 times
Reputation: 20629
We never increase rent with a tenant we want to keep. But our properties are paid for, and that makes us hard to compete with.
We have had one tenant for 9 years. Another died after 13 years.
Reply With Quote Quick reply to this message
 
Old 09-16-2019, 12:01 PM
 
6,590 posts, read 3,076,868 times
Reputation: 16878
We monitored based on the responsibility of the tenants use.
Sounds like you already have good tenants...
I'd steer you away from the market value go to excuse.


Op ,how much are you projecting to lose overall without an increase? 1200$ a year in losses?
Reply With Quote Quick reply to this message
 
Old 09-16-2019, 12:14 PM
 
Location: planet earth
5,359 posts, read 2,070,897 times
Reputation: 11931
"A bird in the hand is worth two in the bush."


Attach a real monetary value to your good tenant, then decide.

I would keep any increase low.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply

Quick Reply
Message:


Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Real Estate
Follow City-Data.com founder on our Forum or

All times are GMT -6.

2005-2019, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top