The average American renter pays about $1,300 per month. As rent prices increase, as a landlord, you have to know when to increase your rent and how to do it the right way without losing tenants.
In this guide, we’ll walk you through how to raise rent without causing too much tension. Read on to avoid landlord mistakes that many make without realizing.
Negotiate With Tenants
If you raise the rent, your tenants may want to negotiate with you. If that’s the case, you can try to do the same back by lowering the raise in rent for those who sign a longer-term lease.
This way, you both are getting the most out of the situation.
Know the Market Price
The first thing you need to know is what everyone else is charging so you don’t overcharge when you increase rent.
Most landlords will not raise the rent over 5% each year. That means you should not either if you want to keep your tenants. You can also go below this threshold if you want to have your tenants favor your place and stay more than just a year.
Meet Deadlines
There’s nothing more frustrating to people than when a deadline isn’t met. The same goes for you as a landlord when you try to raise rent. You need to ensure you are meeting the deadline before trying to raise rent.
This way, your tenants know what to expect in the coming days and can prepare for it as well.
Raise the Rent Every Year
Another great way to ensure you don’t lose tenants when raising rent is to do it yearly. This way, it becomes an expectation.
This doesn’t mean you should raise it by an astronomical number. It could be something as simple as $10 or $20 per month.
Build Good Relationships
One of the best things you can do to raise rent without losing tenants is to ensure you have good relationships with your tenants.
That means you should do the following:
- Respond in a timely manner
- Reach out a few times per year to ensure things are going well
- Keep notes about tenants to reference to build trust and human connection when you talk
If you build these relationships, you can have an easy conversation with your tenants when it comes time to raise the rent.
Raise Rent Without Issues
While you may think that you can’t raise the rent without issues, you can do it in a way that will go over well with your tenants.
By doing it slowly every year, building relationships, and more, you can easily raise the rent without causing issues! As long as you stick with rent laws, you will be good to go.
If you need help with your real estate, we are here for you! At Outland Real Estate, we have you covered. Contact us today with any questions.