Rookie questions: Tenant relationships, timing of moves

[Justin Kates]

Just closed on my first property. A duplex with existing tenants. One month to month. One 3 months left on lease.

What advice do you have about developing relationships with tenants? What about with children of elderly tenant?

When is the right season to seek rent increase and new lease?

TIA

[Drew Sygit]

@Justin Kates you want to be careful how you build tenant relationships.

It should be business-based, not friendship-based. 
Otherwise, they will abuse the relationship when they face a financial challenge.

Tenants never want an increase in their rent, but winter might be a good time to increase rent as there is typically less inventory on the market and who wants to move during the Holidays?
- On the other hand, those same reasons are why winter is the worst time for a landlord to have a vacancy.

We’ve found a great way to raise rent is:

• Determine market rent
• Share the proof with the tenant (they can see it on Zillow anyways)
• Tell the tenant, given your rent is $x and market rent is $y, what do you think if a fair increase?
• Often, they may volunteer a higher amount than you were hoping for.
• Those that respond “$0” or something ridiculous, you can request income documentation from them to justify.
• Don’t be afraid to share with them how much your property taxes & Insurance increased and that YOU cannot afford to absorb them.

ALWAYS get an increase or something of value annually when rents are increasing or tenants will start thinking they should never have an increase, making future increases that much more difficult to negotiate.