Fair rent increase

bacon?

Hi Guys, I jointly own a house with a friend. Back in 2005 we rented a double room for 450euro, and a single for 350euro.

Since 2008 we've rented the double for 300euro and the single for 220euro.

Our house is in good nick, we re-decorrated about a year ago.

Rents in the area are on average, 350euro for a double and 300euro for a single.

We're making a little each month, but I expect this will be used for maintenance and what ever new taxes come up.

I think it's about time to raise the rent a little.

What do you guys think is a fair rent increase? 5% 10%?

Cheers

djimi

Are you raising the rent for existing tenants? If so are you prepared to lose them for the sake of a 5% rise?

In general if you feel that the market rate is €350/€300 and by asking for this it wont put potential tenants off (as in if there arent a significant number of cheaper rooms in similar houses in teh area) then this is what I would say to ask for.

Zulu

If you want to charge more than the market rate: are you prepared for tenant to move out? Because they are not going to view any increase as fair, and will not be happy about it.
If they move out, do you really think you'll rent it within a month? (because if you don't, any rent increase that doesn't cover time the property isn't rented will equate to an overall reduction of income to you)

Personally, as a landlord I rent at the market rate & only consider upping the rent when it's vacant. That said, I seek to rent it as quick as possible, so I match the lowest market rate. I haven't upped rent in 4/5 years, and I've a property on the market at the moment. I'm not upping the rent at this time, because I don't want to lose a months rent.

murphaph

bacon? wrote: »

Since 2008 we've rented the double for 300euro and the single for 220euro.
..
Rents in the area are on average, 350euro for a double and 300euro for a single.

What do you guys think is a fair rent increase? 5% 10%?

Clearly he is not looking to increase to anywhere near over the market rate. Even a 10% increase on 220 leaves the room at 242 and he reckons the market rate is 300 or so, so he'd still be well under that for the single.

A 10% increase on the double still leaves him under the market rate by 20 quid. The only question here is whether or not he's read the market properly but there looks like there's scope to increase the rent on the single for sure without the tenants having anywhere cheaper to go.

Tenants are quick enough to ask for reductions when the market falls, so when the market rate is a good bit higher, then landlords who can closely manage their properties should be looking for something closer to the market rate, especially if the property is in good shape and so on.

bacon?

Yes, it would still be under the market rate. The increase will be put back into the house anyway, I expect the shower to pack in in about a year... they only last around 3 or 4.

SteelyDanJalapeno

bacon? wrote: »

Yes, it would still be under the market rate. The increase will be put back into the house anyway, I expect the shower to pack in in about a year... they only last around 3 or 4.

Thats an awful thing to call your tenants!