I'm considering a duplex that has both units filled with m2m tenants. Each unit is paying about $200 under market rent.
What are your guys thoughts on increasing rent as soon as I make the purchase? I don't mind if the tenants leave, but I'm worried about them vandalizing the property if they do. This is in a B area so its probably not a realistic concern but its my first property so I'm a little weary.
Investor · Bloomington, IN · Member since 2019 · 76 posts · 55 votes
5y
I'd give them a 30-45 day notice that the price is going to be increased up to market rents in the area, I'd give them the option to stay if they want. They could be good tenants and you just don't know it, and they may be willing to pay more. You will always run the risk in your rentals that stuff could be damaged because of whatever reason. We have built into our lease a charge for each specific item in the house, if stuff is damaged we start deducting it from the security deposit. Because you are inheriting tenants you may run the risk of damage occurring, it's unlikely but it happens! I'd make sure you get a good lease drawn up to protect yourself from damages that may occur in from future tenants. You should also ask to see what the lease looks like that they've signed even if they are m2m. No sheet of paper can stop damage from happening, I'd just make sure to have some reserves ready for whatever issues may arise.