In many cases, you can’t increase rent until the lease term ends. Always know and follow your state and local regulations regarding rent increases, as well as the terms of your lease. Trying to raise rent improperly — such as without notice, or to push out a tenant you don’t want — can result in costly consequences. If you want to keep a good tenant despite raising rent (and you should), handle the process with skill and professionalism: GIVE PLENTY OF NOTICE. Many states require at least 30 days’ written notice, but giving more time shows respect and helps tenants plan. COMMUNICATE CLEARLY. Explain why the increase is necessary and emphasize that the new rate remains competitive for the area. When tenants understand that rents and expenses are rising everywhere, they are more likely to accept the change. PROFESSIONAL HELP Evaluating and raising rents can be time-consuming and stressful for any investor. That’s why the professionals at your local Real Property Management office are ready to help. With expert insight into your local rental market, they can ensure your rental is priced right and remains profitable.
maintenance). Adjust your rental rate up or down depending on which apply.
are rising in markets across the country, and if yours aren’t adjusted regularly, you may lose income. Even worse, your expenses may rise faster than your rental income, leading to cash flow problems. By tracking your property’s performance, you’ll have good data to guide increases. Reasons to raise rent may include: ▷ THE AVERAGE RENTAL RATE PER SQUARE FOOT IN YOUR AREA HAS INCREASED (OFTEN BY 2% OR MORE). ▷ PROPERTY EXPENSES (TAXES, INSURANCE, FEES) HAVE GONE UP. WHEN TO RAISE RENT The best time to raise rent is typically when a tenant’s lease is up for renewal.
REGULAR EVALUATIONS = MAXIMUM RENTAL INCOME Knowing how to calculate a rental rate is just the beginning. To keep your property competitive and profitable, it’s important to evaluate your rates regularly. Most experts recommend at least once per year, though in hot markets you may need to re-evaluate more often. RENTAL RATE INCREASES Once you’ve determined a fair rental rate, the next challenge is deciding if, when, and how much to increase it. Rental rates
Contact us today to learn more.
thinkrealty.com | 9
Made with FlippingBook Online newsletter