New Lease or Extension with 2 rent amounts? Chicago

General Landlording & Rental Properties
5yFollow

New Lease or Extension with 2 rent amounts? Chicago

Will Mejia
Member since 2020 · 22 posts · 10 votes
In Chicago you have to provide 4 months notice to raise rent. My leases with tentants expires in 2 months and I just gave them 4 months notice that I will raise the rent. I want to know what you guys think is a better option:
1) In 2 months when the lease expires let it turn "month-to-month" status and then 2 months later start New Lease with New Rent from scratch.
2) Write an Extension Amendum now for another year but specifying the first 2 extended months have same rent as before and New Rent will take effect after. So essentially the extention will have the same rent as now but will change to new rent after 2 months.

Thoughts?

1Reply
19 views

Most Popular Reply

Jonathan KlemmBusiness Member
Moderator
Contractor · Chicago, IL · Member since 2016 · 4k+ posts · 2k+ votes
5y

@Will Mejia - Maybe a silly question, but could you just ask them if they'd be okay with the rent increase in two months when the lease is up instead of having to deal with option 1 or 2?

If not, I personally would rather go to option two which I think provides a little more security to you, the landlord.

I would think @Brie Schmidt or @Mark Ainley may have some good suggestions as well.

[email protected]
Quality Builders4.966 Reviews
WebsiteView Page
1Reply
See this reply in the discussion

4 Replies

Jump to latestLatest
  • Michael Valenzuela
    New to Real Estate · Texas, United States · Member since 2020 · 17 posts · 2 votes
    5y

    @Will Mejia I would just make an amendment and make sure the tenants understand what’s going to happen.

    0Reply
  • Bill B.
    Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
    5y

    Option 1, you end up with 14 months fo rent, that’s good, but they could move out in 2 months, that’s bad.

    Option 2, you get them locked in for 12 more months with 10 months at the higher rate, that’s good. But it’s 2 months less than option 1, that’s bad.

    I guess I would base it on when you want your vacancy. Make the least expire 2-4 weeks before the easiest time for you to find a tenant. Nothing says leases have to be 12 months. Make it 9 or 16, whatever makes it expire at the right time. Or just let it go to month to month and raise it in 4 months and leave it at month to month. 

    I use to be a 2 year minimum lease kidna guy but as I look to sell a group of properties at once I see the advantage of month to month leases. 

    0Reply
  • Jonathan KlemmBusiness Member
    Moderator
    Contractor · Chicago, IL · Member since 2016 · 4k+ posts · 2k+ votes
    5y

    @Will Mejia - Maybe a silly question, but could you just ask them if they'd be okay with the rent increase in two months when the lease is up instead of having to deal with option 1 or 2?

    If not, I personally would rather go to option two which I think provides a little more security to you, the landlord.

    I would think @Brie Schmidt or @Mark Ainley may have some good suggestions as well.

    [email protected]
    Quality Builders4.966 Reviews
    WebsiteView Page
    1Reply
  • Mark AinleyBusiness Member
    Property Manager · Roselle, IL (Chicago Suburb) · Member since 2013 · 2k+ posts · 1k+ votes
    5y

    Thanks @johnathan Klemm. @Will Mejia have your tenants been there for more than three years?  If not you only have to give 60 day notice. See below as written. 

    I would write a brand new lease starting two months from now at the new rent and in the comment section on the first page of the Chicago realtor lease right in that first two months rent will reflect a discount of X. 

    Under the ordinance, landlords must provide: 60 days of notice to raise your rent if you have lived in your apartment for more than six months but less than three years. 120 days of notice to raise your rent if you have lived in your apartment for more than three years.

    [email protected]630-781-6744Podcast Guest on Show #72
    GC Realty & Development LLC4.61066 Reviews
    WebsiteView Page
    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free