Offering different lease lengths to increase rent

[Anthony Cresswell]

Hi BP

I'm wanting to raise the rent on one of my units. The tenant is long term having been there for around 14 years. Unit is under market by around $100/mo or so.

I'm trying to present them with some options as i would like to keep hold of them. I have come up with the following letter. Do you guys think this is too much information or a good idea?

"I have been reviewing the market rent and what you currently pay. I’m a firm believer in retaining quality tenants and you and your family certainly fall into the category. As such, I wish to propose the following options:

2 year Lease term. Rent would increase to $865.00/month for two years. Representing an increase of 4.85%

1 year Lease term. Rent would increase to $875.00/month for one year. Representing an increase of 6%

Month-to-Month lease. Rent would increase to $895.00/month. Representing an increase of 8.48%

Please be advised that effective 5/1/2017 the monthly rent for this premises you occupy shall be increased to $895 per month. This is a change from your present rent of $ 825 per month.

Should you wish to sign a new lease agreement or continue your tenancy month-to-month, please sign and return the attached lease agreement. All other terms of the Lease Agreement will remain in full force and effect. If you do not wish to renew your lease, please provide your notice as soon as possible or no later than the legally required date of 05/30/2017"

[Russell Brazil]

I probably would just raise the rent $25 per year til you got to market rent.....and not have them sign a lease.  They have been there 14 years, so they likely dont want to move...and asking them to sign a lease could be the trigger that makes them move.