Raising the rent is an inevitable part of the rental business, but it happens to be something that raises the likelihood of losing tenants. Expenses such as insurance costs and taxes continue to hike with every passing year as inflation takes effect. This leaves landlords with no option but to raise the rent each time the lease is renewed. Understandably, this comes with the fear of losing tenants since nobody appreciate a rise in costs. With that said, here are some tips for raising the rent without a hassle.
Be firm but friendly
In your interaction with the tenant, make sure you remain firm but are also friendly at the same time. It is important to develop a human relationship with the tenant. Raising the rent each year sets expectations from the start. However, keeping the pace of rent increase with market rent in the neighborhood is key.
Encourage dual communication
You do not necessarily have to merely stick to the form of notice stipulated by the law when it comes to communicating raising rents. Nobody appreciates receiving bad news at all, but when it is delivered by letter it lacks the personal touch. It is better to call your tenants, preferably the same day as you mail the written notice.
Make occasional upgrades
One more useful way to build trust and communication is to ask tenants what upgrades they would prefer to see in the rental home. This can be done once or twice a year, mainly focused on ideas that can enhance the value and marketability of the rental property in the long run. Essentially, it should justify higher rent in the future; not just appease one tenant.
Increasing rent incrementally
Many landlords make the mistake of letting the rent lag behind market level. Later, they try to raise the rent all at once. However, it is often a leap so large that it has a significant effect on the tenant’s budget such that they consider leaving the property. Adjusting the rent by two to three percent every year is likely too keep the rent consistent with market levels and also be manageable for tenants.
At BBA Management, we offer full-service property management in Greater Boston cities like Brookline, Newton, Fenway, Kenmore and Cambridge. You can also contact us or call us at 617-734-6900 or send us an email at email@example.com.