How much do you typically raise your rent per year?

Question

Hi there,

I just started my real estate rental journey early this year with a condo being rented out to a couple. We're almost at the end of the lease and after that, they'll be going month-to-month (as per the 1 year leas agreement).

How much % do homeowners/property manager typically increase rent when lease term is due?

I notice that on average, that's about 3-5%, but similar properties in my neighborhood are now listed for 8-10% of what my tenants are paying.

Travis Hill · Answer

I am more interested in keeping my tenants in the home. Like, @Nate Sanow stated, I like a renewed year lease. I typcially add a percent of rent every 2 years. Of course this is based on market conditions.

Bjorn Ahlblad · Answer

I typically raise 5% on existing tenants, and the majority of tenants are at or near market. At turnover I rely on rentometer.com

Nathan Gesner · Answer

If they are marginal tenants, I keep them at market rate. If they are really good renters, I try to keep the increase 5% or less and then hold off on larger increases during turnover.

Try to avoid letting a tenant get 10% or more below market.

Bill B. · Answer

Until 5 years ago it was 5-10%. The last couple years it’s been 15-20% plus. $200-$400/mo has been common and nobody has blinked.

John Morgan · Answer

@Teresa Villaruz

Depends on the tenant. I keep the good ones way under market rent and raise it maybe 5% every other year. The bad ones get rent increases every year to market rent or close to it.

Eliott Elias · Answer

What ever market is, I don't have a set percentage

Nate Sanow · Answer

My goal is to try to sign a new one year agreement, and I do so by not raising rents. In my market small raises of $20 -$50 might make a little sense after the two years.

Rene G. · Answer

@Teresa,

If you're planning on being a landlord long-term, get into the habit of building systems that take the thinking out. At least, that's what I've been perfecting for the last 10+ years managing my own rentals from Iraq.

I teach my "forever" landlords how to build systems into the lease. You want to keep long-term "good" tenants that have an ownership mentality, right? So how do you encourage long-term tenancy while still having a system? ...I have a whole sections explaining no month-to-month, the daily rate penalty should they go over, if they renew for a 1-year term—rents increases X%, if they renew for a 2-year term—rent increase Y%, etc.

I have so much to say...If you're interested in learning more details you can direct message me.

Rene G

How much do you typically raise your rent per year?

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