Under Florida tenant-landlord law, a tenant must pay the agreed-upon rent on time. Tenants have to comply with this agreement in addition to other responsibilities outlined in a lease.
However, a landlord cannot increase rent without first notifying tenants of the change.
Wondering how to calculate a rental increase? Keep reading to discover the answer in this property management guide.
Research Local Laws
When increasing rents, you need to make sure you are acting in compliance with state and local laws. You'll find the most relevant and reliable information through your state government's website.
There will be regulations that outline how often you can increase rent and how to present it to tenants legally.
Confirm state laws before moving on to city and county regulations. Specific cities have rent control laws in place.
Do Market Research
Compare your property to other units in the area before planning a rental increase. Do this by completing market research.
Market research will help you come up with a new rental rate based on your location. You can search for similar properties and buildings by checking out popular rental listing websites.
Take notes on amenities, rental costs, and unit sizes. These factors will help you decide if a rental increase will lead to higher profits or higher vacancies.
If your property has a history of rental increases, use past information as a reference for changes for the future.
A rental property management company knows all about rental properties and, therefore, can help you complete accurate calculations.
The standard rental increase gets calculated by taking the current rent and increasing it by a certain percentage. Most tenants expect rent to increase no more than 10%.
If you wish to raise the rent by a higher percentage, implement incremental expansions instead of making changes all at once.
This makes it easier for tenants to get comfortable with a higher rent price and can keep you compliant. Use the market research you completed to determine how much you should increase your rent by.
As you learn new rental prices, keep in mind that a set price increase might not work for each type of unit on your property.
Send a Letter to Tenants
In any property management guide, you'll learn that communication with tenants should be a top priority. This is especially true if you plan to raise the rent.
Send a rental increase letter to tenants and get your points across respectfully. Go back to your local research to learn how soon you need to provide notices to tenants.
Most states require that you notify tenants of a rent increase at least 60 days before the change. Whether or not you have fixed-term or month-to-month tenants will dictate how soon you need to notify them.
Can Rental Property Management Help?
There are many things that a rental property management company can help a rental property owner with. If you want to increase profits without losing tenants, we can calculate rent increases and send letters on your behalf.
Contact us today for more information about our property management services.