Landlords need to be tactful when pushing up the rent
Owning an investment property can be a balancing act. On the one hand you want to achieve the highest rent on your property as possible. On the other, it’s essential to have long-term tenants that pay on time and also look after your property.
As vacancy rates continue to fall and demand for rental accommodation remains high, rents continue to climb – which is good news for landlords as it gives scope to push rents up.
So what then is the secret to winning and maintaining a solid tenant / landlord relationship that allows you to up the rent in line with market conditions, without driving tenants out of the property?
1. Be fair – Rather than springing a rent increase without warning, be sure to give adequate notice of your intention to push the rent up. The typical time frame is 60 days, which allows your tenant to seek alternative accommodation; it also gives you time to find new tenants should the sitting tenant decide to move. Ensure that any notice is given in writing and detail the rationale for your decision – which will help pave the way for pushing rents up in the future.
2. Know the market rate – In a rising rental market most tenants will appreciate the need for their rent to be in line with what the market is asking. Research rental rates in your area for like properties and use these as a benchmark to set your rate.
3. Keep your property in top condition – Your tenants are more likely to be open to a rental increase if you’ve maintained your property and met their demands in terms of repairs or other value add-ons. In addition, keeping your property well maintained will help stem longer-term issues. Cracked windows, for example, if not fixed quickly can quickly translate into water damage.
4. Respect your tenants – Throughout any process involving interaction with your tenants ensure that you remain professional at all times. Good tenants are sometimes difficult to come by; through showing that you respect their requests and demands, and deal with matters promptly and completely, you’ll be in a much better position to deal with any issues or negotiate a rental increase. Also, don’t push them too hard for the sake of a few extra dollars – a long-term stable tenant is worth their weight in gold.