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The Right Way To Raise Rent

By Tabitha Naylor

Raising rent has always been a big issue in real estate management because it not only involves finances, but it can greatly affect people's emotions. Right now, apartment rent in Pennsylvania ranges from $360 to $3000. Regardless of where your rent fee lies in that bracket, however, if you want to raise rent, you will need to think not only about your profits but the impact on your tenant(s).

How Do You Raise Rent without Losing Tenants?

The biggest hurdle when it comes to raising rent is having a tenant(s) that can not carry the additional expense and chooses to leave instead. To reduce the risk of this happening to you, you will need to prepare and do the following:

Consider Your Tenant(s)

First and foremost, you must consider your tenants. Who are the most valuable, and would you be able to cope, financially, should they leave? How long have they been a tenant in your property? Do you have an amicable relationship with them? How long has it been since you have raised rent for them? What was their reaction? How long might it take to find a new tenant if they leave? These are just some of the questions you ought to ask yourself before raising your Pennsylvania property rent.

Learn about Rent Control Laws

Certain cities and states observe rent control laws. Before you try to raise your rent, be sure you are following relevant laws and ordinances in your community. Also, it will be beneficial if you refrain from raising rent in the middle of a term. Otherwise, it may result to a dispute or, worse, a lawsuit.

Research Your Market

As we earlier mentioned, raising your rent isn't just about wanting extra profit. You must do your research and make sure your new price is similar to the market average or at least justified. You can easily accomplish this by going online and reviewing other apartments in the area. Conduct quick interviews with other landlords and tenants, and gather their thoughts on their current living situation and what they think can be made better.

Offer Justification and/or Incentives

Always, an increase must be justified. Maybe you haven't raised rent for a decade already, recent repairs and/or upgrades have improved the property, or property taxes have increased. Regardless of what your reason is, you must be thorough in providing an explanation. Most tenants are likely to argue, but if your explanation is solid, it will still be settled in your favor. Another way to placate and keep your tenants while increasing rent is to offer an incentive. For example, you can lengthen your contract from 6 months to 9 months. You can also offer new features like video surveillance, monthly home cleaning, or the like.

Give Proper Notice

You can't just raise rent whenever you want; you must follow a certain process to avoid unnecessary disputes and lawsuits. Generally, adding a clause for rent increase is necessary. Sending a written notice 60 days prior to and holding a face-to-face meeting 30 days before effective date will also be beneficial. Giving ample amount of time will help you and your tenant(s) discuss the issue and come to a mutually beneficial agreement.

Raising rent isn't easy, but it must be done if you want to continue getting profits from your Pennsylvania property. Follow the tips we shared with you today to raise your rent without losing your tenants.

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5/16/2014

Angelina Fox

Living in Pa as an owner you also pay a tax bill yearly for trash collection. My bill is $300 and I live in one.

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