stop landlords from raising it past a certain percentage or dollar amount. If you can raise the rent on your apartment during a lease renewal, then you need to weigh the pros and cons of asking your tenant for more money each month. As previously mentioned, a reasonable fear is pushing a tenant out after proposing a rent increase, then having to spend more money to try to find another renter for the unit. Also consider vacancy rates. Do you see many units like yours left empty in surrounding properties? Have you had issues with finding new renters in other units? Or is your rental in a popular area with constant demand? Know - ing how difficult it will be to rent your unit if your current tenant doesn’t want to pay more in rent will help you determine if it’s worth it to raise the rent. STEP 1 MAKE RENT INCREASES PART OF YOUR LEASE If you live in a place where you can raise the rent, then your tenants are probably expecting that you will do so each year. Make this clear and avoid blindsiding your renters, include this in writing in the original lease. The lease can include information about the increase, such as what percentage of the rent will be added each year or what the dollar amount will be. Also include any information regarding when the tenant needs to give notice or if they are planning to renew the lease. Step two can be tricky. To figure out how much you should be asking for in a rent increase will depend on the market value of similar units in your area. Do some research and compile a list of the rent from some avail - able units within your neighborhood. If the average rent for a one-bedroom apartment is $1,600, it wouldn’t be such a good idea to raise your rent to $1,900 for a similar unit. A normal rent increase would be anywhere between three to five percent of the current rent, but that depends on your situation and current rent as well. STEP 3 NOTIFY YOUR TENANT After you have decided how much you want to raise the rent to, it’s time to notify your renter. This should be done 45 to 60 days before the lease termination date. Because a landlord’s best case scenario is to success - fully raise the rent while maintaining a good relationship with a renter, you might want to have an idea of what you are willing to compromise on in order to keep your tenant STEP 2 DETERMINE HOW MUCH YOU SHOULD INCREASE RENT
happy and comfortable with the increase. These compromises might include repainting the apartment, changing out older appliances, offering com - plimentary parking or other, low-cost concessions. Once you have come to an agreement on how much the rent will increase, be sure to write a signed and dat - ed “rent increase notice” to your tenant for your record keeping. This is good practice prior to renewing the lease.
[Date] [Renter’s Name] [Renter’s Address] [City/State/Zip Code]
RE: RENT INCREASE NOTICE Dear [Renter’s Name].
As you know, your lease at the above address will end on [End of Lease Date].
As of [Date When Rent Increases], the monthly rent for your unit will be increased from $______ per month to $_____ per month. Should you decide to renew your lease, this will be your new monthly rent payment. All other aspects of the lease will remain the same. If you do not wish to renew your lease, please provide notice of this decision as soon as possible or before the required last day of notice, [Last Day to Give Notice], as stated on the lease.
If you have any questions or hope to discuss this increase in rent, feel free to contact me at [Phone Number].
Best, [Landlord’s Name Print] [Landlord’’s Signature] [Date Signed]
Raising the rent and renewing a lease can be simple, but it’s also never been easier. •
Marin Scott is Content Associate at Avail. Avail is a platform that enables landlords to advertise rental units, screen tenants, request background, credit, and eviction checks, create and sign lease agreements, and collect rent — all online.
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