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Raising The Rent
Should you raise the rent after every lease agreement?
Assuming you signed a 1-year lease agreement and you would like the tenant to continue renting your property, decide if you want to have the tenant sign another 1- year lease or simply let the lease expire and go to a month-to-month term. Your original lease should specify if the lease will convert to a month-to-month tenancy. Legally, as long as the tenant continues paying you rent and you continue to accept the rent, you have a month-to-month tenancy.If the tenant has been a good tenant, paying the rent on time, in full every month and taking care of the property, you should evaluate the local rental market and decide if you want to give the tenant a rent increase. Be sure you abide by any rent control laws in your area as you look at increasing the rent.
Make sure you factor into your decision the alternative to the tenant not accepting your rent increase and what a vacancy will cost you in the long run. To minimize the chances of your good tenant balking at your suggested rent increase, you should always keep your rent below the market rent in an increasing rental market. This way if the tenant decides to shop around and see if they can find a better deal, you want them to see that staying put is both the easiest and financially wisest thing they can do given the current market conditions.
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