Stay in the same place for more than a year or two and you’re bound to encounter the dreaded rent increase letter. Your first instinct may be to pack your bags and get outbut this kind of knee-jerk reaction is ill-advised.
After all, there’s no guarantee that your next place won’t be hit by a rent increase later on. So if you like where you live and want to stay, don’t get out the packing tape and cardboard boxes just yet. Instead, see if there is a way to make it work for you!
Why does the apartment rent go up every year?
Knowledge is power, so it pays to understand the factors that influence rent increases. Rents vary from building to building and so do rent increases. Your property manager doesn’t have to give you a reason why he’s raising the rent, but knowing the rationale for the increase can help you come to terms with the extra hit to your budget. The reasons for increasing the rent are different. Often, the increase stems from one or more of the following:
- Necessary repair costs
- Increased property value due to recent upgrades
- Higher property taxes
- General inflation rates
- Changing market factors, such as interest rates
- Higher cost of living
Some apartment buildings will offer upfront and in writing the reasons for the rate increase, but they are not required to do so. You still have the right to ask management. “You’ll want to know the specifics of why some apartment rents go up every year so you can make sure the new rate makes sense.” said Holly Wells with The Estate Update.
It’s also helpful to do a little research on average rental prices in your building, as well as those nearby with comparable units. This can help confirm that the rent increase is appropriate. It may also give you a reason to fight him.
When can you expect a rent increase notice?
Individual states operate a rent increase protocolalthough the rules are pretty much the same.
If you have a written lease, the good news is that you shouldn’t be completely blindsided by a rent increase. Instead, the property owner should explain their rent increase policy up front as part of the lease you sign. The lease should also explain how often the rent may increase. The landlord almost always has to wait until the end of the lease to raise the rent, but if you sign something that says otherwise, you may be stuck with it.
Typically, a landlord will give 30 to 60 days notice of a rent increase, but requirements vary by state and if the lease in question is month-to-month, the rules are slightly different. Landlords can raise the rent at any time as long as they give 30 days notice.
For any increase, notice must be in writing. Do not accept a verbal request. If a rent increase message comes to you out of the blue, you may have the law on your side to fight it and you should consider consulting an attorney. It is also against the law for a landlord to raise the rent just because they think you are a difficult tenant. The rent too cannot be raised in a discriminatory manner.
What does a rent increase notice letter contain?
Rent increase letters are pretty standard and include the following required information:
- Name of Tenant(s)
- The name of the landlord
- Landlord contact information
- The address of the affected property
- The current rental price
- The rent will increase
- The new amount of rent due each month
- The date the rent will increase
- The date
Landlords send rent increase letters by registered mail or hand delivered. This way, the landlord knows that the tenant has definitely received it. Email delivery is not permitted, although the landlord can track this way to ensure you have received it. Some landlords choose to go a step further and include a response form at the bottom. The tenant checks a box next to a statement of whether or not they agree to the rent increase and asks for a signature.
What should I do if I receive a rent increase letter?
If you are okay with the rent increase, go ahead and follow all instructions in the letter. Some landlords will require a response, but others will not. If you have any doubts about a rent increase, take a reasonable amount of time to consider the pros and cons of accepting versus refusing. Tenants who are still unsure of the rationale or willing to negotiate can challenge the increase, but make sure it is done in a professional and friendly manner.
Can I dispute a rent increase notice?
The realization that there is no consistency when it comes to rent increases leaves the subject open for some negotiation. After some back and forth with yours property manageryou may decide staying is the best option.
You can also leave the conversation to find something new. Whatever you do, keep all conversations in writing. If you discuss something verbally with the landlord, be sure to follow up with an email or letter summarizing the conversation. This will protect you if a legal battle arises. Here are some options for dealing with a rent increase letter:
Negotiate a rent increase notice
If you are unhappy with the rent increase or simply have questions, schedule an appointment to discuss with the manager. This also allows you to negotiate the terms of the increase. A diplomatic approach to the conversation is best, as they don’t owe you an explanation for their choice, nor do they have to consider your arguments for changing the increase. If you have something to offer them and you can negotiate termsthere’s a chance you can get something out of it too. Consider offering to:
- Sign a long-term lease on your current rental
- Sign a new lease for a shorter period to ensure that the apartment will be available at the best time to find a new tenant (summer)
- Offer to accept, but only on new terms. Ask for a free parking space or a free storage space. If you pay fees to use the building’s gym, see if you can get this discount. You can even ask for things that will make your life easier. Instead of going with a check to your management office every month, ask your manager to start using RentPay. This platform allows you to schedule and submit rent payments electronically, saving you from having to remember and deliver checks yourself.
It also won’t hurt to remind your property owner what a great tenant you are. “A tenant who pays on time, maintains the apartment and rarely complains should remind their landlord of this. Landlords would rather keep well-behaved tenants than pay turnover costs to find an unknown tenant,” said Caitlin McCabe by RIS Media. sometimes tenants unite to make a stronger case or negotiate improvements around the property. This is a good option, especially if you think the rent increase is unfair.
Accept the new monthly rent
A rent increase doesn’t always come as a one-time notice that you’ll be paying more for exactly what you currently have. Property managers may try to sweeten the deal a bit with some renewal incentives. These can range from in-apartment maintenance like a free deep cleaning of your carpet or actual upgrades like replacing outdated fixtures or adding better security. If incentives were not included when you received notice of the rent increase, talk to your property manager and see what plans are available. It might be worth staying.
Another big argument for accepting the increase is actually the price. While it may seem like you’ll have to pay a lot more each month to stay, add up the increase over the year. Is it less than what you have to pay to move in? Moving is expensive, tiring, time consuming and often inconvenient. You may have a hard time finding another apartment that you like as much as the place you currently live.
All of that inconvenience isn’t worth it when you could potentially pay more up front than you’ll pay in increased rent over the course of a year.
Get out
For some, the rent increase notice is the last straw. Other factors in your current home may have already pushed you in the direction of not renewing your lease, but with the rent increase, you’re sure it’s time to leave. You may also already be dealing with:
- Management that is careless and unprofessional
- Support it takes too long to make the necessary repairs
- The amenities in the common areas seem dated and poorly maintained
- Changing the dynamics of the property in a negative direction based on the new tenant base
Once again, there is also cost to consider as a reason to move out. Consider whether your rent increase is higher than other tenants or the new rent price is higher than what similar units in the area are going for. If that’s the case, it’s definitely time to find a new place to live where you’ll get better and fairer treatment.
Don’t panic
Rent increase rates can average high one year and end up significantly lower the following year, making it difficult to prepare to accommodate an increase. The best thing you can do is not be surprised if you receive a rent increase notice, but instead use these tips to have a productive conversation with your property manager if you want to stay in your apartment.
