According to the State of the Property Management Industry Report (2020), released by Buildium, as much as 47.8% of property managers named “growth” as their top priority. Every property owner wants the rental to be reflective of the prevailing market rates. And, at the same time be able to retain renters. The good news is that, if the tenant-landlord relationship is healthy, a reasonable increase in rent is an easy follow-through. What also plays an important role is the letter you write to your tenants to raise the rent. Simply put, the rent increase letter to tenants needs to be warm and should adequately explain the reason for increasing the rent.
Even before we get to some of the aspects that should be included in the sample rent increase letter, let’s look at some of the specific laws of your state related to the increase in rent. This would include knowing:
- The limit that has been set on an increase in rent especially since rent control and rent stabilization statutes are in effect
- The frequency at which you can increase the rent
- If rent increases can be made within the term of the lease
- The notice that needs to be given for a rent increase, and more.
Elements of a sample rent increase letter
The rent increase letter is an official document that needs to be professional and to-the-point. However, it also needs to convey a sense of empathy and warmth. The fact that you value your tenants is something that should come across strongly from the letter. Some of the elements to include in the letter are:
- A warm personal greeting
- A brief explanation of the rent increase. It could be on account of the rising cost of conveniences, a new city fee that has been levied, and more. Keeping the communication transparent can go a long way in the tenant looking at the increase favorably as opposed to it being seen as a one-sided demand.
- You need to make sure that you communicate that the tenant can reach out to you with any questions
- A personal close
You are likely to come across several templates of sample rent increase letters online. These can come in handy as they ensure that you include the following key information in your letter:
- Tenant’s name
- Property address
- Landlord name and contact information
- The date the letter is written
- The date the rent increase will take effect
- Current rental amount
- Amount of rent increase
- The date the new rent will be due
- A reference to the lease agreement
While you follow these templates for ensuring that all information has been included, it will be worth your while to personalize these letters. It’s also fine to include a form along with the letter that the tenant can fill out and return. You could choose to hand-deliver the letter or mail it with a return receipt. It goes without saying that, if you decide to mail the letter, you need to keep in mind the time taken for the letter to reach the tenant, in working out the requisite number of days for the notice.
If the thought of “how to give notice of a rent increase” has been troubling you, the above details can make your job easy. Here’s to that rent increase, and a long and healthy relationship with your tenants!