Posted over 1 year ago

How to Raise Rent the Right Way

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Besides the day-to-day responsibilities of managing tenants and maintaining your properties, raising rent is an essential responsibility of every landlord. As expenses rise, rent amounts need to climb alongside them, so you can:

  • 1. Keep up with inflation and market rates
  • 2. Pay for increasing property maintenance costs
  • 3. Charge more when you've upgraded the property
  • 4. Accommodate higher taxes
  • 5. Generate more rental income

However, the process isn't straightforward and can be vulnerable to some consequences. For example, raising rent too fast might have tenants feel like they're being mistreated by the management, effectively pushing them away. That leads to vacancies and more frequent, expensive turnovers.

With your rental business on the line, you must handle rent raises with diplomacy and professionalism for everyone to feel at peace with what's happening.

This article will help you raise rent amounts while communicating with your tenants professionally about the increase. We've also provided a sample rent increase notice for you to use next time you need it.

How to Approach a Rent Increase

The key is to prepare your tenants early on. Giving them a proper heads-up will encourage open communication and lessen the shock they'll feel when they receive your rent increase notice.

Well before their lease end date, you want to start the lease renewal/increase process. The required number of lead days depends on your local and state laws but generally ranges from 30 to 120 days.

Our advice for you is to not wait until the last minute.

It’s important that you maximize the time you have in your hands. For one thing, tenants may need time to decide if they'll continue renting, especially if you're demanding a significant increase. Additionally, should they choose to leave, you'll need time to acquire new tenants and lessen vacancy time.

How Much to Increase

You need to be aware of the local regulations surrounding rent amounts. Around 182 municipalities in the US already have rent control laws in place. These laws cover New York, New Jersey, California, Maryland, and Washington DC. They exist to put a cap on how much rent you can charge, primarily to help lower-income residents afford to rent a home.

Otherwise, you may want to weigh the amount of increase against the potential of a tenant moving and the Rent-Ready maintenance costs.

A great way to go about raising the rent is to research market rent and then contact your tenant, asking them this,

“Your current rent is $x, yet the current market rents in your area are $y. We have to raise your rent to keep up with higher property taxes, insurance, etc., so how much of an increase do you think is fair?”.

This helps them feel they have some input and that you care, and you might get a higher number than you had in mind. You can also reject their number and counter with a higher amount.

Sample Rent Increase Notice

Once you're ready to proceed with the rent increase, start by searching for templates, such as this sample notice from Greg B. in BiggerPockets. His letter helps tenants understand the landlord's financial obligations and view the rent increase as a business decision—not an act of greed.

You can use this as a base for creating your own notice:


Dear Mr. and Mrs. Smith,

Thank you for choosing to rent your home from XXXXXXXX Properties. We have appreciated doing business with you for the length of your stay. As you have seen, we have worked hard to respond to your requests while living in your home and to make your stay as comfortable as possible.

A crucial part of maintaining your home is the purchase of maintenance and building materials. Unfortunately, the costs of materials have risen for all of us. In order to keep pace with those expenses, the cost of renting your home will increase as well.

The state of Texas requires that you are served at a 30 day written notice of a change in your rent. This document is that required notice. According to the one-year lease you signed on January 1, 2011, you agreed to pay $700.00 per month to rent your home. Your agreed lease has been fulfilled, and according to that same lease, the agreement converted to a monthly lease.

As of September 1, 2xxx, your rent will increase by $30.00 per month. The total cost of your rent will be $730.00 due on the first day of September and every month following until further notice.

If you do not wish to pay the increased rent, you are allowed, by Texas law, to vacate the rental unit. If you intend to vacate, the original lease agreement states that you have to provide a 30 day written notice of your intent to move to XXXXXXXX Properties.

As a comparison of how your new rent will compare to existing market levels, we did some research on According to their database, the market rent range for a rental unit of your size would be $650 - $850 per month. You can see that, even with the increase in rent, your total cost is very competitive with other rental units in our area.

We do understand that this increase will cause you to consider moving. We also want to emphasize that we consider it an honor to do business with you and would like to continue to do so.

Thank you for your business.

[Signature and name of your business]


No matter how much you temper the increase or how well you write the notice, there will inevitably be some tenant complaints and frustrations that come along with the process. This is to be expected, especially since tenants don't gain many advantages from the increase (except if it's solely due to a rental upgrade).

However, you can steer clear from hostile situations by raising rent amounts fairly and strategically. Manage tenant expectations from the beginning, update them with upcoming changes, and give them enough time to budget appropriately.

When they feel informed and prepared, they'll less likely see the increase as a personal attack from their landlord—but as a reasonable business decision.

Do you have other concerns about increasing rent amounts? Comment below, and we'll get back to you!

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