Rent increase formula? - Landlord Forum thread

Rent increase formula? by Ariamatile on June 27, 2012 @19:12

My sister and I have recently inherited two apt. buildings from my father. They've been a bit neglected (maintenance -wise) in the last years, but we've been doing our best to get the building back into shape. Many of the tenants have been there for years and years. Rents are quite low for the area- in some cases, no rent increase since the late 80's when the building was built. We realize that we have to raise rents soon. And probably do a yearly increase from now on. Our problem is to decide how much to increase each apartment.
I've put together a spreadsheet of current rents, # of bedrooms, square footage and # of months of tenancy, but it's not obvious how to proceed. Do we raise veryone's rent by the same amount? Do we try to raise to current standards and potentially lose the loyal long-term tenants that have the cheapest rent? We want to avoid a huge uproar and possible tenant turn-around. I don't think staggering the increase notices will work. There is a strong sense of community in the buildings. They talk to each other. We want to be fair to ourselves and considerate of the tenants.

Ideally, we come up with some sort of formula that considers amount of space, seniority, etc. that gives us the amount we should raise each apts.' rent by. Anyone out there try to put something like this together?
This feels like an unanswerable question, but I can't help but want a logical answer anyway.
Y'all probably think I'm too soft and will never survive this business. I hope that's not true. Just wanna do it right. Thanks.

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Re: Rent increase formula? by A.T.SF (CA) on June 27, 2012 @20:46	[ Reply ]

Hi, what state is your property located? Many States handle rent increases based on local laws...ie. rent controlled city or annual allotment.

Re: Rent increase formula?