If raising the rents are that important to you, there are a few ways to do it.
Raise them periodically in $25 amounts. This is not an increase substanial enough to scare someone away and you can continue to do this once a year or every six months until you reach the desired rent.
You might want to raise them and consider Section 8 rental. This is a guaranteed amount and you can fill a vacancy almost immediately if someone does leave. The only negative thing about it is that Section 8 decides the rent amount based on your local market
You should also look into a rental agency. There are some where they will locate tenants for you and it is a free service to the landlord.
Posted by Rae Manchester on January 27, 2002 at 23:59:26:
Hi All,
I have a question about rent increases. I just closed two weeks ago on a three family house. The rents are below the current market $100 to $175 per apartment. My question is: How do I increase the rents without creating a hardship on the tenents, or ticking them off so they leave? They have lived there a long time, and two tenants are related. My first instinct tells me to just go for it and raise it the full amount, if they move I can charge the new tenent the higher rent. But, the risk is losing more than one tenant and the income if it isn’t immediately rented. Any ideas? Thanks.
Posted by Ed Doherty on January 29, 2002 at 21:16:26:
I bought a 2 family 12/99 and the tenant upstairs was the daughter of the seller and paying $150 ($500) under market. I let them know I could not make the deal unless I had $650 a month. This was more than fair and after the initial sticker shock they were ok. I just made sure I was very attentive to their needs.
I raised rent in 9/00 to $675. 9/01 to $700.
She kicked the old boyfriend out and had a new one start living there. I asked what there intentions were and they offerred to pay $775 a month. I said $750 was fair. (the market is real strong and average rents are 800-1000 now). I have no problem because there are no good apartments out there. I am buying the 2 family next door and going to start at $850 a month after a nice cleanup.