Raising Your Tenants’ Rent Without Feeling Guilty

With year-over-year inflation rates reaching an average of 2.5% that means raising rent is inevitable for most landlords and property managers. However, it can be hard and you may feel guilty to pass the financial burden along to your tenants. Even more if they’re long-term, have a good track record, or are your friends and family. Here are four ways to increase rent without feeling guilty.

In the Beginning, Add an Addendum to the Rental Agreement

From the get-go advising tenants ahead of time that rent will increase 2-3% each year is a good way to alleviate any shock that comes from raising the rent when their lease expires. If they ask, explain that a small increase helps cover increase taxes and minor repairs. This also sets the tone that your tenants should expect that this increase will occur upon their lease expiring.

Make It Personal, It will Go a Long Way

Typically, landlords send out a letter at the end of a lease to renew or go month-to-month. This is a good time to introduce the increase in price and explain your reason(s).

Remember, it’s ok to be transparent with your tenants! If you invested in any upgrades, express it to your tenants that you want to continue to make enhancements to their home. Pointing out improvements can help take away the sting of a price increase. This also helps tenants feel confident that their money is going back into improving their living conditions.

Rent Increases Need to Abide by Local Laws and Should Be Reasonable

In the case of a private landlord one may choose to take a low maintenance and reliable tenant over a small increase in rent each month. If you’re in it for the long-haul, it might not be worth potentially driving good tenants out. However, if you make the yearly increase small there’s a very good chance they’ll stick around.

Distribute Costs

At the end of the lease agreement if you feel uncomfortable about raising the rent with a monthly fee, you can always consider changing how you charge for utilities.

For example, if you currently cover water and cable, inform the tenants they will now be in charge of paying the bill(s) and include it in their new lease. This will make it more palatable to do a rent increase the following term.

Upon renewing their lease with their new increase, reassure your tenants that you look forward to serving their needs and that you are grateful they are renting from you. This will go a long way!


There is nearly 37% (1/3rd) of people renting in the U.S., according to the Pew Research Center. This is up 31 percent just a decade ago and growing annually. According to Zillow, U.S. renters spent $535 billion on rent in 2016 – up 3.7 percent from the previous year. Strikingly, a 2016 Zillow report found that 76 percent of rent payments are still made offline, in the forms of cash, check or money order.

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