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Posted: 5/4/2015 1:37:26 PM EDT
[#1]
As someone whos not a landlord....I'd raise the rent then give them some type of "good tenant" / "renewal" discount. The paperwork would then reflect market rates but the actual amount paid would not change.
But again....Not a landlord. I just hear about some of the horror stories out there with tenants, and I think it makes it sound like good tenants are worth their weight in gold. |
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Posted: 5/4/2015 1:37:38 PM EDT
[#2]
tell them to google "COLA" if they are worried about not being able to adjust.
Just be sure you inform them when lease renewal comes up. tell them it has to go up before the next time they sign. |
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Posted: 5/4/2015 1:37:46 PM EDT
[#3]
I'm not a Landlord but it is my understanding that good tenants are hard to come by. How much would you lose if a shit head rents the place and tears it all to hell.
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Posted: 5/4/2015 1:38:53 PM EDT
[#4]
I live in a housing market that is absolutely booming right now. Roughly 1.1% vacancy rate, houses on the market are selling in <48 hours, people are offering $10-20k over asking price, the works.
My rent has been raised every year I've been here because of this. I'm not a landlord yet, but I think it'd be silly to not raise rent if the market demands it. |
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Posted: 5/4/2015 1:39:04 PM EDT
[#5]
I put it in the lease from the get-go.
It raises X dollars or a certain percentage. Then I follow that. If you have solid tenants you can sign an addendum to waive the increase for a year. That way they see it as you giving them a break rather than negotiating to bring it up to market. Don't get to enamored with tenants no matter how well they take care of the place. I've seen 3 year tenants turn to shit. Also, moving is a pain in the ass. Most tenants will pay a rent increase rather than move as long as the increase is reasonable. Business is business. They are contract counterparties, not your friends. |
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Posted: 5/4/2015 1:39:27 PM EDT
[#6]
Quote HistoryQuoted:
I'm not a Landlord but it is my understanding that good tenants are hard to come by. How much would you lose if a shit head rents the place and tears it all to hell. this. a bird in the hand... |
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Posted: 5/4/2015 1:39:38 PM EDT
[#7]
I have commercial properties, so it's a bit different, but my leases usually specify it. So they know at signing what is to come. If I let tenants go off lease for a while (after lease expiration), for whatever reason, I do CPI adjustments for the local market. The odd thing is they usually hate CPI adjustments, so they get back on lease. Often CPI is less than the built in 3% yearly increase we usually do... I still haven't figured that one out, but I like them on leases so it's a good tool for tenants I want to keep around.
Long story short, your expenses go up each year. Property taxes, etc. You will run yourself into the ground if you don't do some level of increase. |
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Posted: 5/4/2015 1:39:46 PM EDT
[#8]
Quoted:
i have couple of rentals. the tenants have been in there for 3-4 years. i have only raised it once sine they have been in there. in my area the rents are going crazy though. they are good tenants that take care of the house and pay the rent on time. if i were to raise it $100 and it went empty for a month it would take me a year to recoup that month. You landlords out there, do you raise the rent according to the market or does a good tenant outweigh the need to sometimes adjust rent every 3 years or so, if they are decent tenants not as often as that. Good tenants are rarities! 
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Posted: 5/4/2015 1:39:58 PM EDT
[#9]
I have a rental in FL, I say keep it the same, what does the contract say? There should be a clause about going month to month. Also, you can talk to them and see what they say
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Posted: 5/4/2015 1:41:00 PM EDT
[#10]
As a past tenant when my landlord came to me to increase the rate due to the local town bumping taxes I was good with it, but he was also a great landlord. If there was issue he took care of it promptly or let me address the issue and just reduced the materials costs from the coming months rent. If he was doing just because I would have had to weigh my options at that time.
YMMV |
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Posted: 5/4/2015 1:41:53 PM EDT
[#11]
If I had good, solid tenants, I probably wouldn't raise anything unless the operating expenses (maintenance, etc.) went up.
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Posted: 5/4/2015 1:43:33 PM EDT
[#12]
Quote HistoryQuoted:
I'm not a Landlord but it is my understanding that good tenants are hard to come by. How much would you lose if a shit head rents the place and tears it all to hell. This is my first thought. My BIL bought a home to use as a rental. Major issues until he found the right renters. Also, $100 increase a month is a HUGE increase. |
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Posted: 5/4/2015 1:43:44 PM EDT
[#13]
Each and every time for residential units. Have to with rent control.
Not so with commercial. Got good commercial tenants and they're worth keeping (no rent control on commercial). |
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Posted: 5/4/2015 1:48:21 PM EDT
[#14]
Quoted:
i have couple of rentals. the tenants have been in there for 3-4 years. i have only raised it once sine they have been in there. in my area the rents are going crazy though. they are good tenants that take care of the house and pay the rent on time. if i were to raise it $100 and it went empty for a month it would take me a year to recoup that month. You landlords out there, do you raise the rent according to the market or does a good tenant outweigh the need to sometimes If they are good tenants it's in your interest to keep them. They are a known quantity. I only raise rent when necessary and keep the rent low enough for them to consider moving as a bad idea. You've already mentioned the long lag in recovering lost rent. Nobody ever lost money making a small profit. |
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Posted: 5/4/2015 1:49:25 PM EDT
[#15]
Good tenants can sometimes be hard to come by.
But if rents are really high compared to what you charging currently I would raise it some. No sense short changing yourself. |
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Posted: 5/4/2015 1:50:16 PM EDT
[#16]
My tenant pays yearly and with that he gets a discount.
Don't ask me why he does it but if he wants to pay me 14000 a year at one time to save 10 percent. Fine with me. |
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Posted: 5/4/2015 1:53:02 PM EDT
[#17]
Quote HistoryQuoted:
If I had good, solid tenants, I probably wouldn't raise anything unless the operating expenses (maintenance, etc.) went up. The have been paid off a long time ago so its all gravy to me. Being a landlord is some times fun but most of the time a pain. i ask myself do i value the extra money more than the possibilty of a bad tenant. |
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Posted: 5/4/2015 1:53:05 PM EDT
[#18]
Current renters have been there 4 years, I haven't raised at all.
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Posted: 5/4/2015 1:53:11 PM EDT
[#19]
I wont raise the rent on a tenant unless the taxes or insurance goes up substantially.
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Posted: 5/4/2015 1:55:20 PM EDT
[#20]
Your costs go up yearly. Your rent has to cover expenses.
We've been in the rental business for 45 years |
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Posted: 5/4/2015 1:56:08 PM EDT
[#21]
Quote HistoryQuoted:
The have been paid off a long time ago so its all gravy to me. Being a landlord is some times fun but most of the time a pain. i ask myself do i value the extra money more than the possibilty of a bad tenant. Quote HistoryQuoted:
Quoted:
If I had good, solid tenants, I probably wouldn't raise anything unless the operating expenses (maintenance, etc.) went up. The have been paid off a long time ago so its all gravy to me. Being a landlord is some times fun but most of the time a pain. i ask myself do i value the extra money more than the possibilty of a bad tenant. In your situation, comparable rents would have had to gone waaaaaay up (like doubled or tripled) for me to consider giving up good tenants. |
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Posted: 5/4/2015 1:57:15 PM EDT
[#22]
What I do is raise the rent according to how the property tax is assessed on my properties. Sometimes its 5 bucks a month increase, sometimes its 20. However If I have a tenant who is good, and wants to stay long term, I'll offer them a 3-5 year lease and won't raise their rent for the duration of the lease. Costs me a little bit, but guaranteed rent for up to 5 years is worth the small loss in rent increases.
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Posted: 5/4/2015 1:57:57 PM EDT
[#23]
OP are you making enough on the property to build up a reserve to handle things like roof, exterior paint, mechanicals, plumbing, electrical, tax increases, etc?
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Posted: 5/4/2015 1:57:58 PM EDT
[#24]
Quote HistoryQuoted:
If they are good tenants it's in your interest to keep them. They are a known quantity. I only raise rent when necessary and keep the rent low enough for them to consider moving as a bad idea. You've already mentioned the long lag in recovering lost rent. Nobody ever lost money making a small profit. Quote HistoryQuoted:
Quoted:
i have couple of rentals. the tenants have been in there for 3-4 years. i have only raised it once sine they have been in there. in my area the rents are going crazy though. they are good tenants that take care of the house and pay the rent on time. if i were to raise it $100 and it went empty for a month it would take me a year to recoup that month. You landlords out there, do you raise the rent according to the market or does a good tenant outweigh the need to sometimes If they are good tenants it's in your interest to keep them. They are a known quantity. I only raise rent when necessary and keep the rent low enough for them to consider moving as a bad idea. You've already mentioned the long lag in recovering lost rent. Nobody ever lost money making a small profit. Tenants are never a known quantity. NEVER. Life happens to people -- car accidents, drug habits, divorce, illness. As a landlord you have to accept that when the shit hits the fan, your lease will be broken. You're low on the list of priorities. Make your money while the market supports it. You can be slightly below market, and you never want to be way above market in price -- don't give them more incentive to break the lease -- but failing to raise rents in a rising market tells your tenants you are a sucker and takes bread from the mouths of your family. The more business-like you run the relationship, the more likely you are to see a good turnover when they do leave... which is where most problems happen. |
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Posted: 5/4/2015 1:59:25 PM EDT
[#25]
We're in that boat right now, as long-term (4 years and counting) tenants.
We've been paying the same amount since we moved in, and consider ourselves fantastic tenants. We don't ask for much, fix the house out of our own pocket if it's not too big a project, paid for a fence to be professionally installed, are nice to the neighbors, joined the neighborhood watch...that kind of stuff you look for in tenants. They've been great landlords, so far...fixing/upgrading appliances, keeping our rent steady, etc. We just asked the landlords if we can stay in for another few years, since the Army extended us for another tour. I partially expect them to come back and say "yes, but we're increasing the rent." I would respond by packing up my family, and finding another rental nearby. I figure our current rent more than covers what a mortgage of 30 years would cost, plus a bit extra for their own profit. In short, the rent is more than fair and I would view any increase to our rent as a big "FU", given our history in the house to date, and would move my family accordingly. |
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Posted: 5/4/2015 1:59:54 PM EDT
[#26]
Former residental manager here.
Good tenants are worth their weight in gold and are as scarce as hen's teeth. Act accordingly. |
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Posted: 5/4/2015 2:02:22 PM EDT
[#27]
Quote HistoryQuoted:
We're in that boat right now, as long-term (4 years and counting) tenants. We've been paying the same amount since we moved in, and consider ourselves fantastic tenants. We don't ask for much, fix the house out of our own pocket if it's not too big a project, paid for a fence to be professionally installed, are nice to the neighbors, joined the neighborhood watch...that kind of stuff you look for in tenants. They've been great landlords, so far...fixing/upgrading appliances, keeping our rent steady, etc. We just asked the landlords if we can stay in for another few years, since the Army extended us for another tour. I partially expect them to come back and say "yes, but we're increasing the rent." I would respond by packing up my family, and finding another rental nearby. I figure our current rent more than covers what a mortgage of 30 years would cost, plus a bit extra for their own profit. In short, the rent is more than fair and I would view any increase to our rent as a big "FU", given our history in the house to date, and would move my family accordingly. Is your current rent above or below market? |
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Posted: 5/4/2015 2:02:46 PM EDT
[#28]
Quote HistoryQuoted:
Is your current rent above or below market? Quote HistoryQuoted:
Quoted:
We're in that boat right now, as long-term (4 years and counting) tenants. We've been paying the same amount since we moved in, and consider ourselves fantastic tenants. We don't ask for much, fix the house out of our own pocket if it's not too big a project, paid for a fence to be professionally installed, are nice to the neighbors, joined the neighborhood watch...that kind of stuff you look for in tenants. They've been great landlords, so far...fixing/upgrading appliances, keeping our rent steady, etc. We just asked the landlords if we can stay in for another few years, since the Army extended us for another tour. I partially expect them to come back and say "yes, but we're increasing the rent." I would respond by packing up my family, and finding another rental nearby. I figure our current rent more than covers what a mortgage of 30 years would cost, plus a bit extra for their own profit. In short, the rent is more than fair and I would view any increase to our rent as a big "FU", given our history in the house to date, and would move my family accordingly. Is your current rent above or below market? At market |
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Posted: 5/4/2015 2:03:06 PM EDT
[#29]
Two personal experiences - I used to rent a condo in San Diego. The first year it was $780 a month, the next year it was $820, the next year I lived there rent went to $1280. I rented a house, the first year it was $750 and for the next 10 years it was $750. The house was paid off, the owners were so happy to have me and the wife living there they didn't raise the rent. |
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Posted: 5/4/2015 2:04:55 PM EDT
[#30]
You should make yourself aware of what rents for very comparable units are in your area before the new tenants sign a lease. That way, the initial rent is a fair amount If costs go up, then re-adjust during negotiations of subsequent lease. You might consider revealing your cost of doing business to your tenants--or not. Your call.
Good tenants are hard to find, but so are good landlords. It's a two way street. Don't forget that moving is a real hassle, especially if kids are involved, as most parents hate to yank them away from their friends and so forth. |
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Posted: 5/4/2015 2:05:18 PM EDT
[#31]
Quote HistoryQuoted:
Former residental manager here. Good tenants are worth their weight in gold and are as scarce as hen's teeth. Act accordingly. i think it depends on if one is doing it as a buisness or as a side like i am. i only have a couple of units. i know people that have 20- 50 and its their buisness now and they do it full time so any hassle is just a part of doing buisness. |
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Posted: 5/4/2015 2:06:21 PM EDT
[#32]
Quote HistoryQuoted: My tenant pays yearly and with that he gets a discount. Don't ask me why he does it but if he wants to pay me 14000 a year at one time to save 10 percent. Fine with me. That's a damn good tenant a keeper for sure. |
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Posted: 5/4/2015 2:07:00 PM EDT
[#33]
When I was a slumlord, I did not raise rates on the renters. Don't raise the rates when you re-sign them, and let them know you're not raising the rates while other landlords are. A happy renter is a good renter.
If the first rate was fair, I doubt your costs have increased dramatically. Each month, they're paying > 100% of your expenses related to that property. That's worth much more than the extra bucks you're not getting. When the current renters eventually leave, bump up the rate for the next renter. |
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Posted: 5/4/2015 2:07:55 PM EDT
[#34]
Good renters I leave alone. Especially since your property is paid for.
New people come in then you raise accordingly. |
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Posted: 5/4/2015 2:08:52 PM EDT
[#35]
Assuming your fixed costs are not increasing and you need to raise rent to cover them, I wouldn't drive away good long-term tenants for an extra $100/month.
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Posted: 5/4/2015 2:09:30 PM EDT
[#36]
Small increase like $50 . Would seem reasonable
Posted Via AR15.Com Mobile |
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Posted: 5/4/2015 2:09:42 PM EDT
[#37]
My landlord has raised my rent every year for the last 3 years. I headed it off at the pass this time and said let me know ahead of my 60 day notification if you plan to raise my rent this year so I can turn in my notice to vacate on time.
It's up $200 in 3 years. Might or might not be worth it, but my income sure hasn't increased $200/month since then. |
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Posted: 5/4/2015 2:11:31 PM EDT
[#38]
No. not if they are good.
I had one for 8 years that was good. never raised but the tax and insurance did not go up much either. They kept asking and I kept telling them you just pay that rent on time and we have no problems keep going. |
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Posted: 5/4/2015 2:12:23 PM EDT
[#39]
It pissed me the fuck off when I was a renter.
Especially so when there were numerous vacant apartments around me. I was a clean, courteous tenant who always paid on time, but continuous rent increases made me find a different apartment. Most people only stay in an apartment for a few years. I wouldn't raise the rent on someone in that span. Especially if you want to keep them. |
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Posted: 5/4/2015 2:13:59 PM EDT
[#40]
Quote HistoryQuoted:
No. not if they are good. I had one for 8 years that was good. never raised but the tax and insurance did not go up much either. They kept asking and I kept telling them you just pay that rent on time and we have no problems keep going. Yeah. My tenant pays a little under market rent value. But pays on time and takes good care of the place. I'm not going to try raising it on him. I am going to inform him though that he is paying under, and that I'm not raising it because he is a good tenant. |
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Posted: 5/4/2015 2:15:01 PM EDT
[#41]
A local commercial building owner raised the rent on all the tenants, and promptly lost 2/3 of them. Some of the space is still empty 2 years later! He will never recoup the lost income. I've seen it happen time and time again.
$100 just isn't worth it. Wait until they vacate or you you have more at stake to roll the dice. |
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Posted: 5/4/2015 2:16:12 PM EDT
[#42]
Renter in a college town. Rent goes up every single year. My particular building never has a vacancy for more than a few days. The RE market in this town is nuts. Houses are frequently sold before the sign goes up. Less than a week is very common. There is no such thing as a starter home in this town.
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Posted: 5/4/2015 2:18:05 PM EDT
[#43]
Quote HistoryQuoted:
Current renters have been there 4 years, I haven't raised at all. My previous landlord didn't raise our rent in the 6 years we lived there. Then again, he viewed the property as his retirement fund rather then a source of monthly revenue. Well that and we didn't bug him for minor issues, handling most little BS stuff ourselves. Rent showed up in his account via EFT on the first of the month, every month without exception. I think we went a couple of years without even speaking to him. Man, was he bummed when we told him bought a house and were moving. Got 100% of our deposit back and were invited to dinner by him and his wife. |
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Posted: 5/4/2015 2:20:08 PM EDT
[#44]
Ask them about it.
Seriously. Go ask your tenants. |
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Posted: 5/4/2015 2:21:12 PM EDT
[#45]
We rent out office space in our building.
Our expenses (especially our exorbitant property taxes) go up every year. Why would we not pass those costs on? |
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Posted: 5/4/2015 2:22:24 PM EDT
[#46]
IDK, ins goes up, taxes go up, they gotta realize that.
Next lease I'd include a copy of area comps, explain the market, any improvements you've made, blahblah. Tell them what you feel is a fair market increase and then tell them you will halve that increase since they've been such good tenants. Seems reasonable to me. |
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Posted: 5/4/2015 2:25:01 PM EDT
[#47]
I had a buddy who never raised the rent on one his tenants ever. They kept the house clean and paid on time every month.
They ended up renting from him for nearly 30 years and paying for the house three times over. After my buddy died his son kicked them out and sold the house. My buddy said he knew he could get more money, but there was a nice feeling in never worrying about who was renting the house. |
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Posted: 5/4/2015 2:27:25 PM EDT
[#48]
My gf has a rental house (2 story, 24xx sq ft) thats she has been renting out to the same family for 4 or 5 years now. great family/tenants, always pay on time, keep house clean. I guess she met the wife at church, they were down on their luck so she helped them out and now they are doing well and the husband just recently joined the military,...ect.ect.ect. I want to say they pay $900/mo. she has debating on raising the rent $200 about a year ago but doesnt want to lose them as tenants, so she has decided not to. Market value for for the house/area is $1200-1300. She already said if/when they move out she will raise it to whats the normal amount for the area.
When i was a tenant for 6 years with a few friends, i think rent was only raised once or twice, and each time it was like $40 or $50. I tend to think it was cause we were "good" tenants and always paid on time. The contract said every 1/4 there is a walk through inspection. never even a stain or broken anything. Only "issue" we had is a few years into it the company changed management and the normal inspector we got was let ago and this old fudd would come visit. always walked around with his 1911 (open carry) and would talk about it like it was another person and talk down to us (as to intimidate us with it). so 1 day when we knew he was coming to do the inspections the 3 of us took all of our guns down to the kitchen table and had a "clean our guns" day. Inspector ran the door bell and my 1 friend answered it with his 870. You could tell he was taken back alittle and when he saw all the guns on the table he turned what was a 20 min inspection into a few mins at best.  never saw him again, the next inspector was this lady who would always schedule an appointment with us but never show. happened for YEARS. come to find out she would just go do whatever she wanted instead of inspections and marked all the places as pass. 
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Posted: 5/4/2015 2:28:06 PM EDT
[#49]
I've had rentals for over 10yrs, and don't believe in ever raising the rent on a good tenant.....look out for them and they do the same. If you try to maximize profit you'll find less stability with your rentals and most often less $.
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Posted: 5/4/2015 2:28:54 PM EDT
[#50]
Depends...
Are you in it to make money or are you in it to pay your mortgage until you can sell at a profit? I rent a house down in GA. The tenants there right now suck balls. Their rent will be going up considerably...which will probably make them move out. As is, they're not getting their deposit back b/c it will all be spent on replacing landscaping that they got rid of (apparently...upkeep of grounds/landscaping means remove mature shrubs/crape myrtles). Good renters are hard to come by. Keep them if you can. A reasonable few percentage raise yearly is to be expected. Keep the rent the same now...write in that next years will raise by X% to renew due to blah blah blah... I need to look over my lease...I think 10% is a possibility in ours. |
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