How to Increase the Rent Without Losing Your Tenants
Just like a majority of other aspects of property management, increasing the rent is also an art. How? Well, that’s because most tenants would always frown when it comes to increasing the rent, no matter how nicely you treat them. And sometimes if the sentiments of the tenants aren’t addressed, they might want to leave your rental property and start looking for other houses for rent. While some landowners prefer balancing the financial advantages of increasing the rent over keeping ideal tenants who don’t cause any issues and always pay their rent on time, others hesitate to raise the rent due to the fear of causing an argument with the tenants for asking more money or losing the tenant.
However, increasing the rent is usually inevitable as insurance costs increase and taxes go up every year. Also, if the rental market rates increase and landlords do not raise the rent, their net income will be reduced.
Want to raise the rent without losing your ideal tenants? Well, here are some useful tips for successfully raising the rent.
Top Tips to Raise the Rent Without Losing Your Tenants
There are many ways to increase the rent without damaging a successful landlord-tenant relationship. Some of the best ones have been mentioned below.
- Increase the Rent Gradually
While looking for apartments for rent in Canada, renters prefer having a rent raise policy in the rental agreement that states the rent can only be raised once a year if the lease is renewed. Why? Well, that’s because many landlords increase the rent so much that it goes beyond the renters’ budget and makes it impossible for them to pay the rent.
Remember, raising the rent above the fair market rate will not only make your property unaffordable to the tenants but your existing tenants may not want to renew the lease. Hence, raising the rent incrementally over a period of time until you reach the market value of your property can be an ideal option.
- Provide Your Tenants with a Notice
Tenants may be initially upset that you are increasing the rent. But if you avoid the element of surprise, give them advanced notice of at least 30 days before raising the rent. It will provide your tenants with ample time to prepare themselves for a higher monthly rent.
- Give Your Tenants Value for Their Money
Did you know, that tenants choose houses for rent over buying a new home because they can have the access to specific amenities such as gyms, pools, parking lots, laundry facilities, and convenience stores that would otherwise be an enormous expense? So, if you, too, show your tenants what value they will be getting if the rent is increased and also promise to bring in new amenities to your property, they will certainly agree to pay more rent.
The Bottom Line: Every tenant’s situation is different which makes it practically impossible to predict how they will react if the rent is increased. But that doesn’t mean you won’t raise the rent, right? Just follow the above-mentioned points and you will be able to increase the rent easily without losing your tenants. Also, try not to raise the rent by more than 10% as it would definitely bust your tenant’s budget. Should you be looking for a company that offers the best rental relocation service and can help you find ideal tenants for your rental properties, reach out to us. At Home Finders, we offer landlords the best platforms to advertise and manage their rental properties. Moreover, our pre-screened tenant database will provide you with a wide list of renters who are looking for houses for rent.