Many people purchase properties as investment properties; the idea is to rent the property out to cover costs and your mortgage, and sell the property when it has appreciated sufficiently. However, many landlords can get themselves into trouble by failing to comply with the law as it relates to their obligations. This article will briefly discuss the rules pertaining to raising rent.
As an initial matter, you are bound by the terms of the lease you signed with your tenant. As such, you cannot raise the rent until the original lease has expired. This goes for year-to-year leases as well as month-to-month leases. Moreover, you must give your tenants at least 30 days’ notice prior to raising rent (and if you’re interested in being nice to your tenants, you should give them 60 days’ notice so they can make whatever arrangements they need to make); if you are raising the rent by more than 10%, you have to give 60 days’ notice (so give them 90 days’ notice if you want to be nice about a 10% increase).
Unless your property is a rent-controlled apartment, there aren’t many rules restricting how much you can raise rent (though common decency, and business knowledge, suggests you don’t raise rent to a point where nobody is willing to rent it); the only restriction is that you do not raise rent to punish your tenant, you will get into a lot of trouble for that.
Ultimately, rental properties can be very lucrative. However, owning a rental property also exposes you to certain liabilities; it is essential that you comply with the law if you prefer to keep your profits, rather than turn them over to a tenant because you failed to comply with the rules.
At the Chernov Team we understand that knowledge is power, and knowledge of how to comply with landlord/tenant law is powerful knowledge indeed. At the Chernov Team we know that whoever comes to the table most prepared leaves with the most, and the Chernov Team always leaves the table with the most.