22 Oct 19
Why raise the rent? When raise the rent? How to raise the rent without losing your tenant?
There is no time of the year better than any other to raise rent. No matter when you send the notice, your tenant will not be thrilled – but they should understand. There is always a possibility your tenants could look at moving out. The trick is minimise that possibility as much as you can.
WHEN According to RTA you can raise the rent every 180 days with 60 days notice*. Small frequent rent raises are far more manageable for tenants than large raises every couple of years.
HOW MUCH As you did when choosing what rent rate, look up 3-5 nearby, similar properties and see what rents they are going for. If your tenant challenges your rent raise at tribunal you will need to prove your increase is only to keep up with market rates. Also, if you are pricing yourself above the market your tenants could simply give notice and move into a property down the street at better value than your own. This is a double shot in the foot for yourself as you will likely have up to 2 weeks vacancy plus all the time effort and costs finding new tenants requires.
WHY Raising rent will not only give you more cash, but should also increase the value of your property. You could use the new value to leverage equity for another property.
*2019 update - this is currently looking like it will change to once per year. Accurate at time of writing, make your own enquiries at the time of leasing your property.