Letting your property can be a bit like running a business. To be a profitable landlord you need the right combination of a well-priced property and responsible long-term tenants. So how can you foster favourable landlord-tenant relationships when it’s time to increase the rent?
Know the market
Research the rental property market in your area to make sure your increase only matches market rates. Most good tenants will understand the need to pay a higher rent amidst a tightening rental market and low vacancy rates.
Maintain your property
As with any business, success comes through consistent planning and efficiency. Nipping small maintenance problems in the bud – fixing a cracked window for instance – can prevent minor problems escalating into major catastrophes. As an added bonus, your tenant will be satisfied, making your property more attractive to future tenants or buyers should you choose to sell.
Rent increase notices and reminders
If the market indicates a time for a rent rise, then you’ll need to give your tenants fair warning in advance. Sixty days is the usual time frame, but check with your agent to be sure. Send a letter and have your agent explain the terms in full to them. This way, tenants can expect their rent to rise in the near future, without the shock of an overnight increase. If you don’t have an agent, follow a similar process in terms of time frames and procedures.
When it comes to bumping up the rent, tenants respect and respond better to landlords with a professional demeanour. Try asking your tenants out for a coffee, or arrange a convenient time for a visit and then follow up in writing. Conduct yourself professionally, and listen to any requests or concerns your tenants have. If you handle your property privately, it might be a good idea to bring in a third party to manage these discussions.
A professional manner is important but don’t forget that you’re dealing with people too. Good tenants can be hard to come by, so don’t push them too hard for the sake of a few extra dollars.