Consider Consistent Rent Increases ⋆ The Miranda Team Real Estate Group

For rent sign on property with rent increases.

Consider Consistent Rent Increases

November 06, 2018 / Category: Investment Real Estate, Rental Investment

After a period of barely being on the radar, inflation has begun to become an issue again. If you are a landlord this directly affects your bottom line. There are many things to consider when implementing rent increases to keep up with inflation.

 

First, increasing rent in a courteous manner includes communicating with your tenants in a way that will protect your relationship with them. This is a topic estate author Kevin Ortner educates landlords on in Realtor Magazine. Below are some of his recommendations:

rental agreement with rent increases
rental agreement, close-up
  • Consider raising rents on a regular schedule. An excellent time for this would be during the lease renewal. If it is a month to month agreement a year of tenancy would be a suggested period. Increasing in small amounts annually is a better more tenant friendly way to handle rent increases rather than a large amount arranged more infrequently.

 

  • You should be competitive. You need to consider what price tenants will be willing to pay to rent from you. The actual amount must be in compliance with Florida and local laws of course. When considering a price go to the Bureau of Labor Statistics’ annual estimation of Shelter Cost Changes. At the end of August, it was 3.4%. While national trends are important, the amount other Coral Spring’s tenants are paying to rent similar properties is more significant.

Doing an Open House? Consider All the Senses!

  • Give the tenant more time. While you must adhere to the law and the terms of your lease, it will make it easier on a tenant if you give them a little extra notice of any impending rent increases. This may be especially important if you have a particularly good tenant that you wish to hold onto. If you are keeping your rent competitive, they will they will see that it is a sensible increase if they research what other similar properties are renting for.

 

  • Always work with your best tenants. It is important to take the individual situations of tenants you want to retain into consideration. Show them what the rent increase was going to be. Then show them a smaller number that they will be asked to pay. Consider sharing with them any operating cost increases that have led to their rent increase.

Looking To Sell Your Rental Property

These recommendations on rent increases by Ortner can help you get the most money from your property while protecting your relationship with your tenant. If you are looking for assistance in finding investment properties, give us a call today!

 

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