What are valid reasons to increase rent on tenants

34 Replies

@Anthane C. Richie Sr.

Anytime you have the opportunity to make improvements is a good way to increase rent. Just keep in mind what market you're in to have comparables and not to go over-the top with improvements. You don't want to make high-end improvements where it's not common in that market.

If they won't pay the increased rent are there others that will with ease and no lost time? Then absolutely increase.  Many tenants get pissed hearing about a rent increase so they start looking around.....and realize your rent increase ain't bad at all.  

are they GREAT tenants?  Not good but GREAT.  I have one set of tenants that are great, she is a bartender, he is a carpenter.  If anything breaks they always fix it and just give me a heads up about it.  Everytime I drive by the house the grass is always cut.  If I ever have to go inside to repair something beyond their means, the house is always tidy.  Most importantly, rent is always paid on time.  Market value says I can raise their rent by probably a good $150 now but it's not worth it to me.  They are super low maintenance.  I may bump them up $50 because taxes have gone up a few hundred on that property.

Keep the fridge as is and just raise the rent 25 dollars a month.  Most tenants won't even complain about a small amount like that.  Some places I rented at raised my rent over 50 dollars a month.

Have you done a rental comparison in your area to see if your rent is right in line with the area?  You would be surprised just how many people never do that only to find out later on they are well below where they should be.

Tenants come and go.  Jobs change as well as relationships.  Most tenants have their mind made up of whether they go or stay before their lease is even up.  If that tenant doesn't renew than by all means replace the fridge and raise that rent.

@Anthane C. Richie Sr. If you have a great tenant I’d either do small increases or none at all. I inherited an A+++ tenant. Re newed their lease st same rate for an extra year. The tenant is a handy man who offered to fix and take care of the unit for nothing! Is the extra 300-900$ a year worth pissing off a tenant that can damage your property or even stop paying rent all together and be out 6-9 months worth of rent? (I live in an extremely tenant friendly state)

It’s all about relationships being a people person and having a gut instinct

Good luck

My rent increases are typically very small ($15.00) on one year lease renewals. If the tenant is paying what I consider to be near the top of the market, I'll sometimes not increase it at all. Also, sometimes I won't do a rent increase if I want to retain a tenant that can't afford an increase. Not as a favor to them but to me as I don't want the turnover. During turnovers, I'll raise the rent to whatever the market will bear.

@Anthane C. Richie Sr. ,

This isn't a negotiation or something to bargain with.   I guarantee if you say "I'd like to raise your rent $25, but you'll get a new fridge"--- they will say "The fridge works great, I'd prefer to keep this and not have my rent go up."  no one wants to pay more rent, from the tenants perspective, you're just paying more for the same thing you got last year for cheaper.

It is a little bit of a dance, if you have an A+ tenant, personally we don't raise rent unless we heavily invest and upgrade the home.   We have 1 house that we rent for $850/mo, A+ tenants, never complain, fix things, very nice, clean... we'll keep them there, but when they move out-- without a doubt-- it's going to $900-$950!   If it's a PITA I wouldn't mind losing, I just send them the proper notice, and it's their choice!    

When the tenants move out I raise the rents but I do mostly apartments where people seldom stay past 18 months . No need to have that resistance or tension this way