Rent increase

[Anonymous]

Anonymous wrote:

Anonymous wrote:we have a tenant who has rented out a townhouse for the last 6 years, he is a great tenant, pays on time, takes care of the place, and unless some big issues do not bother us.
This area has gone up significantly in rent, new townhomes rent around 30% more, I am wondering if we should continue renting at the lower rent or put it back out on the market

Are you insane???

You have a great tenant, who for the past 6 years has paid on time, he takes care of the property, and unless some big issues come up, he doesn't bother you, and you're all like:

"Hmmm? Maybe we've had it TOO good for TOO long? Maybe we've been lucky for TOO long? Maybe it's our turn to be smacked upside the head to give us a reminder of the dregs of society and reality? We've had an amazing run for the past six years, but I guess it's our turn to get a harsh reminder about squatters rights, and damage to the property, and non-payment for months on end... and by the time we realize that we should've been GRATEFUL for our wonderful tenant, it will be far too late. Oh well... break out the Craigslist ad!".

See what I'm getting at?

Ask him to pay 10% more this year, then 10% more next, and every two years after that (since you didn't increase the rent at all in 6 years) but for the love of God, do NOT let this tenant go!

... and if you DO happen to choose chaos & insanity, rather than stability and piece of mind; please post your tenants number here.
I'll be thrilled to rent to him and unlike you, I won't take his respect for my property (and myself) for granted.

- owner/landlord

Hey! Me 1st!

[Anonymous]

Anonymous wrote:we have a tenant who has rented out a townhouse for the last 6 years, he is a great tenant, pays on time, takes care of the place, and unless some big issues do not bother us.
This area has gone up significantly in rent, new townhomes rent around 30% more, I am wondering if we should continue renting at the lower rent or put it back out on the market

I think a lot of posters may have breezed by the fact that new townhouses rent out for 30% more than yours (which is obviously not new). So absolute best case you could be collecting 30% more but more likely less than that, give your property won’t be as shiny as the others.

Given that, I’d keep the tenant and not mess with any increase. Consistent and low-hassle income definitely wins out over gambling on a new tenant and perhaps a few months without rent, in my opinion.

If you do want to raise, give them a lot of notice. Your contract may not require you to do so, but it’s the decent thing to do for a solid tenant, and it gives them time to either plan or negotiate with you—at which point you can decide what is really important to you.

[Anonymous]

Can all of the landlords who insist on never raising rents for good tenants please post links to their properties? I am sure many on this board would love to rent from you!

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You don’t run a charity. Raise rent to at least market rate. Have you even been in the house in the past few years? They probably trashed it thinking you don’t care. Higher rent means higher caliber renters. Kick out the free loader.

+1000.

I own 14 rentals. This is a business. If you're in the DC area where rents are often in the $3000 a month range, even a 10% raise is acceptable if the market allows. 300 x 12 x 5 at 6% is money left on the table. Big time.

Inother words, that's $20,000 you left on the table.

DP. Sooooooo....you have 14 rentals. We have 37. We're much more like OP than you. A bird in the hand and all that. The only time we raise to market is if we want a tenant to leave because they are a PITA; otherwise, we keep our increases in the $50 to $150 range, even for our $6k+ properties.

You are lambasting the poster who used my supporting post of $100 per month annual increase, which incidentally is the same amount you actually raise rents by. Op lost $20K. That is a huge mistake.

[Anonymous]

Depending upon the jurisdiction, there may be restrictions on your ability to increase the rent too

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You don’t run a charity. Raise rent to at least market rate. Have you even been in the house in the past few years? They probably trashed it thinking you don’t care. Higher rent means higher caliber renters. Kick out the free loader.

+1000.

I own 14 rentals. This is a business. If you're in the DC area where rents are often in the $3000 a month range, even a 10% raise is acceptable if the market allows. 300 x 12 x 5 at 6% is money left on the table. Big time.

Inother words, that's $20,000 you left on the table.

DP. Sooooooo....you have 14 rentals. We have 37. We're much more like OP than you. A bird in the hand and all that. The only time we raise to market is if we want a tenant to leave because they are a PITA; otherwise, we keep our increases in the $50 to $150 range, even for our $6k+ properties.

You are lambasting the poster who used my supporting post of $100 per month annual increase, which incidentally is the same amount you actually raise rents by. Op lost $20K. That is a huge mistake.

Correct. I'm the 14 guy. PP is an imbecilic troll. Imagine telling your tenant that you're raising rent 0.8%? Because that's what they claim on a 6K rental. In reality they are really just some poor renter pissed about being a poor renter.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You don’t run a charity. Raise rent to at least market rate. Have you even been in the house in the past few years? They probably trashed it thinking you don’t care. Higher rent means higher caliber renters. Kick out the free loader.

+1000.

I own 14 rentals. This is a business. If you're in the DC area where rents are often in the $3000 a month range, even a 10% raise is acceptable if the market allows. 300 x 12 x 5 at 6% is money left on the table. Big time.

Inother words, that's $20,000 you left on the table.

DP. Sooooooo....you have 14 rentals. We have 37. We're much more like OP than you. A bird in the hand and all that. The only time we raise to market is if we want a tenant to leave because they are a PITA; otherwise, we keep our increases in the $50 to $150 range, even for our $6k+ properties.

You are lambasting the poster who used my supporting post of $100 per month annual increase, which incidentally is the same amount you actually raise rents by. Op lost $20K. That is a huge mistake.

Correct. I'm the 14 guy. PP is an imbecilic troll. Imagine telling your tenant that you're raising rent 0.8%? Because that's what they claim on a 6K rental. In reality they are really just some poor renter pissed about being a poor renter.

Well, bless your hearts. You are the ones who don't get it. If we have a tenant leave, that property is down for a minimum of one and probably two months. For a $6,000 rental, that means we are out $12,000 rental income for that year for that property PLUS costs for paint and general repairs, and realtor fees. I'll take a $100 or $150 rent increase, for a total increase in rental income of $1,200 or $1,800, instead of a minimum $12,000 loss any day. But you do you, sweetie.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You don’t run a charity. Raise rent to at least market rate. Have you even been in the house in the past few years? They probably trashed it thinking you don’t care. Higher rent means higher caliber renters. Kick out the free loader.

+1000.

I own 14 rentals. This is a business. If you're in the DC area where rents are often in the $3000 a month range, even a 10% raise is acceptable if the market allows. 300 x 12 x 5 at 6% is money left on the table. Big time.

Inother words, that's $20,000 you left on the table.

DP. Sooooooo....you have 14 rentals. We have 37. We're much more like OP than you. A bird in the hand and all that. The only time we raise to market is if we want a tenant to leave because they are a PITA; otherwise, we keep our increases in the $50 to $150 range, even for our $6k+ properties.

You are lambasting the poster who used my supporting post of $100 per month annual increase, which incidentally is the same amount you actually raise rents by. Op lost $20K. That is a huge mistake.

Correct. I'm the 14 guy. PP is an imbecilic troll. Imagine telling your tenant that you're raising rent 0.8%? Because that's what they claim on a 6K rental. In reality they are really just some poor renter pissed about being a poor renter.

Well, bless your hearts. You are the ones who don't get it. If we have a tenant leave, that property is down for a minimum of one and probably two months. For a $6,000 rental, that means we are out $12,000 rental income for that year for that property PLUS costs for paint and general repairs, and realtor fees. I'll take a $100 or $150 rent increase, for a total increase in rental income of $1,200 or $1,800, instead of a minimum $12,000 loss any day. But you do you, sweetie.

If you're renting to people that don't understand an annual rent increase tied to inflation costs (especially in a supposed 6K rental) then you're either a troll or renting to drug dealers. Anyone in DC (This is DCUM, afterall) that's paying 6k a month in rent knows 5 times as much about economics then you do.

But, bless your heart. I'm just the idiot over here with 10million~ in paid off real property paying me each month.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You don’t run a charity. Raise rent to at least market rate. Have you even been in the house in the past few years? They probably trashed it thinking you don’t care. Higher rent means higher caliber renters. Kick out the free loader.

+1000.

I own 14 rentals. This is a business. If you're in the DC area where rents are often in the $3000 a month range, even a 10% raise is acceptable if the market allows. 300 x 12 x 5 at 6% is money left on the table. Big time.

Inother words, that's $20,000 you left on the table.

DP. Sooooooo....you have 14 rentals. We have 37. We're much more like OP than you. A bird in the hand and all that. The only time we raise to market is if we want a tenant to leave because they are a PITA; otherwise, we keep our increases in the $50 to $150 range, even for our $6k+ properties.

You are lambasting the poster who used my supporting post of $100 per month annual increase, which incidentally is the same amount you actually raise rents by. Op lost $20K. That is a huge mistake.

Correct. I'm the 14 guy. PP is an imbecilic troll. Imagine telling your tenant that you're raising rent 0.8%? Because that's what they claim on a 6K rental. In reality they are really just some poor renter pissed about being a poor renter.

Well, bless your hearts. You are the ones who don't get it. If we have a tenant leave, that property is down for a minimum of one and probably two months. For a $6,000 rental, that means we are out $12,000 rental income for that year for that property PLUS costs for paint and general repairs, and realtor fees. I'll take a $100 or $150 rent increase, for a total increase in rental income of $1,200 or $1,800, instead of a minimum $12,000 loss any day. But you do you, sweetie.

If you're renting to people that don't understand an annual rent increase tied to inflation costs (especially in a supposed 6K rental) then you're either a troll or renting to drug dealers. Anyone in DC (This is DCUM, afterall) that's paying 6k a month in rent knows 5 times as much about economics then you do.

But, bless your heart. I'm just the idiot over here with 10million~ in paid off real property paying me each month.

It is interesting to me that you're completely ignoring the poster's argument about the costs associated with the unit being unrented. I concur with the other poster that I would rather have a small net increase rather than a $12K+ loss.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You don’t run a charity. Raise rent to at least market rate. Have you even been in the house in the past few years? They probably trashed it thinking you don’t care. Higher rent means higher caliber renters. Kick out the free loader.

+1000.

I own 14 rentals. This is a business. If you're in the DC area where rents are often in the $3000 a month range, even a 10% raise is acceptable if the market allows. 300 x 12 x 5 at 6% is money left on the table. Big time.

Inother words, that's $20,000 you left on the table.

DP. Sooooooo....you have 14 rentals. We have 37. We're much more like OP than you. A bird in the hand and all that. The only time we raise to market is if we want a tenant to leave because they are a PITA; otherwise, we keep our increases in the $50 to $150 range, even for our $6k+ properties.

You are lambasting the poster who used my supporting post of $100 per month annual increase, which incidentally is the same amount you actually raise rents by. Op lost $20K. That is a huge mistake.

Correct. I'm the 14 guy. PP is an imbecilic troll. Imagine telling your tenant that you're raising rent 0.8%? Because that's what they claim on a 6K rental. In reality they are really just some poor renter pissed about being a poor renter.

Well, bless your hearts. You are the ones who don't get it. If we have a tenant leave, that property is down for a minimum of one and probably two months. For a $6,000 rental, that means we are out $12,000 rental income for that year for that property PLUS costs for paint and general repairs, and realtor fees. I'll take a $100 or $150 rent increase, for a total increase in rental income of $1,200 or $1,800, instead of a minimum $12,000 loss any day. But you do you, sweetie.

If you're renting to people that don't understand an annual rent increase tied to inflation costs (especially in a supposed 6K rental) then you're either a troll or renting to drug dealers. Anyone in DC (This is DCUM, afterall) that's paying 6k a month in rent knows 5 times as much about economics then you do.

But, bless your heart. I'm just the idiot over here with 10million~ in paid off real property paying me each month.

It is interesting to me that you're completely ignoring the poster's argument about the costs associated with the unit being unrented. I concur with the other poster that I would rather have a small net increase rather than a $12K+ loss.

It's interesting to me that you are ignorant of both Real Estate and Math. It's just numbers, buddy. If it sits vacant for a month, the commission covers that and then added rent is then cream on top.

The following year, you invoice a lease renewal fee. The owner only loses if he doesn't know what he is doing. That, plus the fact that everything is net if you own them outright. Is there really a difference between an occasional $29,000 a month versus the usual $32,000? Is your financial situation so out of control that you live and die on a 10% variance of your monthly take home?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You don’t run a charity. Raise rent to at least market rate. Have you even been in the house in the past few years? They probably trashed it thinking you don’t care. Higher rent means higher caliber renters. Kick out the free loader.

+1000.

I own 14 rentals. This is a business. If you're in the DC area where rents are often in the $3000 a month range, even a 10% raise is acceptable if the market allows. 300 x 12 x 5 at 6% is money left on the table. Big time.

Inother words, that's $20,000 you left on the table.

DP. Sooooooo....you have 14 rentals. We have 37. We're much more like OP than you. A bird in the hand and all that. The only time we raise to market is if we want a tenant to leave because they are a PITA; otherwise, we keep our increases in the $50 to $150 range, even for our $6k+ properties.

You are lambasting the poster who used my supporting post of $100 per month annual increase, which incidentally is the same amount you actually raise rents by. Op lost $20K. That is a huge mistake.

Correct. I'm the 14 guy. PP is an imbecilic troll. Imagine telling your tenant that you're raising rent 0.8%? Because that's what they claim on a 6K rental. In reality they are really just some poor renter pissed about being a poor renter.

Well, bless your hearts. You are the ones who don't get it. If we have a tenant leave, that property is down for a minimum of one and probably two months. For a $6,000 rental, that means we are out $12,000 rental income for that year for that property PLUS costs for paint and general repairs, and realtor fees. I'll take a $100 or $150 rent increase, for a total increase in rental income of $1,200 or $1,800, instead of a minimum $12,000 loss any day. But you do you, sweetie.

Tenants don’t leave over small annual
Increases. I used $100/ month as an example. On a $6k rental that is off by 100%. It wasn’t a $20k mistake you made. It was a $40k mistake.

I’m not sure that quantity of units makes one better than another. But if it does I have largely gotten out of the residential housing game and now just have some minority partnerships left in residential properties. I now buy exclusively commercial. But if the unit count matters I have a minority partner in about 200 units in dc currently.

Annual rent raises for everyone (barring unusual circumstance- ie covid). Typically 2-3%

[Anonymous]

Anonymous wrote:
I own 14 rentals. This is a business. If you're in the DC area where rents are often in the $3000 a month range, even a 10% raise is acceptable if the market allows. 300 x 12 x 5 at 6% is money left on the table. Big time.

Different scale.

I have one rental unit going at ~$3000/mo. An extra $200/mo is not material to me. A headache of a tenant is. I'd gladly forgo a small bit of extra money if it means I never have to think about the rental.

Now if I had 10+ doors to manage then at that point I'd be thinking from a more purely business perspective. But with one unit that shift in mentality is not worth an extra hundred or two a month

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You don’t run a charity. Raise rent to at least market rate. Have you even been in the house in the past few years? They probably trashed it thinking you don’t care. Higher rent means higher caliber renters. Kick out the free loader.

+1000.

I own 14 rentals. This is a business. If you're in the DC area where rents are often in the $3000 a month range, even a 10% raise is acceptable if the market allows. 300 x 12 x 5 at 6% is money left on the table. Big time.

Inother words, that's $20,000 you left on the table.

DP. Sooooooo....you have 14 rentals. We have 37. We're much more like OP than you. A bird in the hand and all that. The only time we raise to market is if we want a tenant to leave because they are a PITA; otherwise, we keep our increases in the $50 to $150 range, even for our $6k+ properties.

You are lambasting the poster who used my supporting post of $100 per month annual increase, which incidentally is the same amount you actually raise rents by. Op lost $20K. That is a huge mistake.

Correct. I'm the 14 guy. PP is an imbecilic troll. Imagine telling your tenant that you're raising rent 0.8%? Because that's what they claim on a 6K rental. In reality they are really just some poor renter pissed about being a poor renter.

Well, bless your hearts. You are the ones who don't get it. If we have a tenant leave, that property is down for a minimum of one and probably two months. For a $6,000 rental, that means we are out $12,000 rental income for that year for that property PLUS costs for paint and general repairs, and realtor fees. I'll take a $100 or $150 rent increase, for a total increase in rental income of $1,200 or $1,800, instead of a minimum $12,000 loss any day. But you do you, sweetie.

If you're renting to people that don't understand an annual rent increase tied to inflation costs (especially in a supposed 6K rental) then you're either a troll or renting to drug dealers. Anyone in DC (This is DCUM, afterall) that's paying 6k a month in rent knows 5 times as much about economics then you do.

But, bless your heart. I'm just the idiot over here with 10million~ in paid off real property paying me each month.

It is interesting to me that you're completely ignoring the poster's argument about the costs associated with the unit being unrented. I concur with the other poster that I would rather have a small net increase rather than a $12K+ loss.

It's interesting to me that you are ignorant of both Real Estate and Math. It's just numbers, buddy. If it sits vacant for a month, the commission covers that and then added rent is then cream on top.

The following year, you invoice a lease renewal fee. The owner only loses if he doesn't know what he is doing. That, plus the fact that everything is net if you own them outright. Is there really a difference between an occasional $29,000 a month versus the usual $32,000? Is your financial situation so out of control that you live and die on a 10% variance of your monthly take home?

You are not making any sense at all. What commission? WTF? Of course there is a difference between 29 and 32k. What kind of business experience do you actually have?

[Anonymous]

Anonymous wrote:

Anonymous wrote:
I own 14 rentals. This is a business. If you're in the DC area where rents are often in the $3000 a month range, even a 10% raise is acceptable if the market allows. 300 x 12 x 5 at 6% is money left on the table. Big time.

Different scale.

I have one rental unit going at ~$3000/mo. An extra $200/mo is not material to me. A headache of a tenant is. I'd gladly forgo a small bit of extra money if it means I never have to think about the rental.

Now if I had 10+ doors to manage then at that point I'd be thinking from a more purely business perspective. But with one unit that shift in mentality is not worth an extra hundred or two a month

Yep, we're in this boat. A single row house in DC and would prefer to make a modest profit with great tenants and minimal hassle while banking the appreciation and equity from having them pay our mortgage. We'll just reprice (and underprice to market) when they decide to leave.

[Anonymous]

This is easy. Raise the rent, but by just 5-10%, so they won’t leave. Raise the rent by small amounts yearly after so that it won’t be all at once.