Morning all,
I am thinking of increasing my tenants rent. The reasons for this are as follow, since moving in they told me the kitchen wasnt good enough, the cuboard doors where actually rotton i found out. So instead of just getting new doors i renovated the entire kitchen, new stove, new cooktop, new marble benches, new everything, cost a lot of money.
Then they without me knowing cut the front gate in half, it was a double gate with 2 doors that joined in the middle you know for the driveway. Somthing about fitting his boat in, i was very upset, they still havnt told me about it i only know from my drive past a while ago.
They complain about every little fart, the carport was crooked, so i fixed it, i mean whoopidoo!
A storm blew the door shut and the glass broke, i mean as if more like the guy slammed it in a fit or somthing, thats not my fault! I didnt replace the doors glass, they did but they didnt even get anywhere near the original glass replaced. Just some cheap crap instead. Anyway im not thrilled with the tenants but they are paying rent and always ontime.
I am thinking about a $10 weekly increase, what do you all think? From $180 – $190.
There is no lease agreement so nothing is stopping me from doing this, i just want to be fair to them, so your oppinions are needed.
Thank you
The Shrink lady ![chill]
Hello.
How long have they been in your property?
An increase of 5%pa, which is what you are proposing, is pretty standard.
Cheers,
Art‘Great spirits have always encountered violent opposition from mediocre minds.’ – Albert Einstein
By all means, put up the rent! Council rates, insurance and, most of all, interest rates, have gone up. However, I suggest to you that you will have to give some notice depending on where you are located. I assume that there was a lease and that the term of the lease has expired and that now it operates on a ‘continuing basis’. The tenents will probably ask for a lease with a long term but with the way things are going it is best to insist on only 6 months but preferably, carry on with the ‘continuing’ terms on the initial contact.
They have been there almost a year, one month before the 12 month anniversary i will phone them and let them know of my plans. The other houses in the area that look like mine with the same condition are renting for $200 – $220, thats what i want also, but how do i go about that? It would be pretty rude if i just raised the rent from $180 to $200ish per week.
Honestly i was thinking of $190, but now after looking on realestate.com i realise maybe i should raise more.
I dont want to rip off my tenants, but its true, the insurance, the council rates, the intrest rates all go UP, so why should i be the silly clown handing out charity so to speak.
Whats appropriate? $190, $200 i dont think id have the guts to go higher, lol
The shrink!
Hello
I don’t know about NSW but in Vic. you need to give 60 days notice of your intention to raise the rent. I would check this first.
Personally, seeing as you have renovated the kitchen, I would go for at least $15 if not the full $20.
Maybe you could set up an inspection as you need to see what has happened to the gate as well as discuss with them the fact that naturally this will have to be put back to the original state when they leave.
At the same time you could mention your intention to raise the rent by $20pw and why ….. renovated kitchen as well as rising interest rates …….all in a relaxed and friendly manner…… and see their reaction. You can always allow yourself to be bargained down to $15 if necessary.
After that I believe you will need to give it to them in writing. Even if it’s not a legal obligation it’s certainly better.
After your discussion with your tenants re the gate I think it would be wise to send them a letter confirmimg what you had discussed and agreed on regarding this as well.
Good luck [smiling]
Elka$10 increase is the standart rate change.
Those people got the new kitchen!
Preferably you should increase the rent by at least 10% of your investment cost – otherwise you wasted your money.How much did your kitchen costs? (even if you did it yourself – what is your time costs/)
And don’t forget to increase their bond as well.
If they ever move out get the cost of gate repair/replacement of their bond!!! They made a damage.Cheers,
Hi Psychiatrist,
Why are you wanting to pussy foot around to get their permission to increase the rent (to market value) in your house after you have been more then reasonable meeting their every whim!..They have you just were they want you. Where did they get the right to change the gate without asking you first?
I would write a letter to give 60 days notice that the rent will increase in 60 days to match market value and you had noticed while driving past the gate has been altered you would like this returned to the original condition by …………(give a date for this to be done by).
I liked what Steve said (in one of his books)for whim list tenants…Tenant would say I would like a new airconditioner in the bedroom and Steve would say yes that is possible are you prepared to pay $5 per week extra rent the tenant would either say yes or no…easy peasy.
Good luck
Jenny1
What is the vacancy rate in the area? If there is a strong rental demand, and the tenants don’t want to pay market rent, give them the required notice and find a new tenant.
Make sure you increase the rent in accordance with the market from then on, so you keep your investment in line with others. Most tenants expect an increase periodically, and as long as you are being fair you shouldnt have to worry about losing a good tenant. By the way, paying their rent on time is what is expected of them – that alone does not make them a good tenant, so don’t feel guilty.
Good luck.
WakeWho is in control of the property – you or them? Don’t assign your control away to them. Make sure you are positive when you approach them. Thank them for paying on time etc. Tell them market rates have gone up to $220 per week but as they are good tenants you are prepared to cut them a brake and only raise the rent $15 per week instead of $20, even though you put in a new kitchen. Give them a 12 month lease to sign and a discount voucher or a movie pass should they sign. You get want you want and they feel like they have won as well.
Definately mention the gate in writing so that you have a confirmation when you try and take it out of there bond.
Thank you everyone for your assertive, positive and strong help. I do get strength from you all.
Its good to have a supportive network here.
I will raise it, i am determined.
Psychiatrist [thumbsupanim]
Hi
Considering all of the work you’ve done, have you adequately protected your property with a good landlords insurance policy with all the proper components. With this in place, you could then proceed to put in place a proper tenancy agreement. These two small moves should put you in a more ‘commanding’ position.
Cheers
Gary
author of “Property Millionaire: The Guidebook to Having Great Australian Dreams”
creator of “Property Millionaire – The Boardgame”
http://www.888abundance.comraise the rent !!
thats my two cents. [biggrin]“It’s not how much money you make, It’s how you spend it that matters.”
Aspiring property developer
Giulio Taranto
Small dilema, i spoke to a few very close older friends, who say they wouldnt raise it by $20 a week that its too steep. One says to raise it $9 a week one says $15 – 16 a week? What do you all think about that now? Im so puzzled.[jerry]
Hi
I’m still not sure whether there is no lease or a periodic lease (month by month). In any case, i think your first step is still to get a fixed term lease in place with your proposed rental amount built in (ie $20pw); but I’d get your real estate agent to ‘suggest’ in writing that the amount is appropriate after an inspection. With the landlord’s insurance, that really is a basic protection you need in place otherwise your ‘leverage’ with the tenant will not be very good (eg if they default on the rent, if they further ‘damage’ by accident, etc.)
Gary
author of “Property Millionaire: The Guidebook to Having Great Australian Dreams”
creator of “Property Millionaire – The Boardgame”
http://www.888abundance.comIf you do not increase the rent the tenant will think they are on a good wicket and will not want to leave. You can end up by not increasing the rent for 7 years that you have to increase the rent by a greater amount later. It is like cooking a lobster if you throw a lobster in boiling water it will scream. If you gradually increase the temperature each year the lobster will get used to the increase. if the lobster doesn’t like the temperature increase you get a lobster that can tolerate the increase.
I made this mistake over a 7 year period and when I finally increased the rent by $5 a week the tenant did a runner and the house got trashed as it was vacant.In Qld you need to give 7 weeks notice (from my expirence) for a rent increase, with a maximum increase of $20.
I say with the improvments you have made, put the rent up by $20 or up to market value. The tennants can then have a choice to leave or stay, at which point (if they decide to leave) the rent can go to market value.CATA
Asset Protection Specialist
[email protected]Hello again.
We live in a modest apartment in Sydney’s east. The rent is cheaper than the mortgages we’re paying on our IPs so we stick around. Plus, it’s a great place and the landlord is great (when things break they get fixed straight away, things are kept clean, gardens tidy etc.). Last year the rent went up $20/wk (around 8%) but the place is so awesome that we stayed on anyway. After all, moving is such a giant pain in the neck that $960/year is more than a fair price to pay…especially when we would have to pay about that much more per annum in a new place anyway.
My point is, as a tenant you have to expect rent raises. So raise the rent $20 and if the tenants stay on then great. If not, you’re still charging market rent so you’ll attract tenants who will be happy to pay what your place is truely worth.
Cheers,
Art‘Great spirits have always encountered violent opposition from mediocre minds.’ – Albert Einstein
If your not fussed on whether the tenant moves out or not (and it sounds like you shouldn’t be, unless there is a high vacancy rate in the area), then definitely increase the rent to near market value. Maybe increase to $200 now and to $220 in 6 months. Personally, I would send the tenant a 6 month lease to sign accompanied by a letter saying something like “…. if you are happy to continue living here, please sign the enclosed lease and return it to me by xx/xx/xx.”
There is nothing unreasonable about a 10% increase especially when it is still less than the market rate.
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