apartment, landlord, real estate

Raising Rent

This is a baffling topic.

I mailed out 100 rent increases last week.  We all came to work today dreading the complaints from tenants.  We received complaints but they weren’t from the tenants.  They were from the owners.  Rent increases are a part of life.  No one likes them but in a normal rental market they are expected.  Most tenants do not move because of a rent increase.  How can you justify moving over a $30 (average) rent increase?  There have been severe down markets during my career when I didn’t charge increases but most of the time they are needed to keep up with rising costs.

Why don’t some landlords raise their rents?  They don’t want the tenants to move.  They don’t want the tenants to request repairs or improvements.  A few are mercy driven and don’t want to cause a hardship.

What is the advantage to increases?  Keeping rents up with the overall cost of living.  Offsetting tax, insurance, association, repair increases.  Increasing cash flow to pay for future improvements and housing requirements.

I encourage owners to charge a fair, market sensitive increase yearly.  3% is the national average.  I do take into consideration those on fixed incomes and those I know that are struggling just to get by.  Most tenants will pay and keep renting.  If they use the increase as an excuse to move, my guess is that they were already planning to move anyway.

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