Annual Rent Increases

[Scott Schultz]

As a landlord, it's very important for me to keep residents as long as I can for obvious reasons. I increase rent annually with renewal but provide an anniversary gift to them upon renewal. This year, rent increases for a fourplex is only $10 per month, raising rents to $590 for a two bedroom apartment. We currently pay water and trash. My question is tempered with making more money with the rent increase but keeping the the residents. I've already given them the "if they have a financial hardship what would be a middle ground on the increase" but they are resistant. Both pay on time and take care of the place. I realize that should be the normal expectation but I am not sure that an extra $120 a year is worth the turn around time and cost to rerent if I can get at least another year. Thanks for the help.

[Bill B.]

On $1200-$1500/mo rents I increase the rent $25-$50/mo. Their is a near-zero chance that anyone would put in the effort and spend the money to move over $300. If they move, they were going to move anyway. 

I’ve also started to take the same approach on renewals. I used to send them out 60 days in advance, I’ve moved to 90 days. I still get an answer within 1-2 days. as I assumed, the tenants know if they want to stay. I think they appreciate the heads up and I know I do.