A.D. CANTELMO REALTY/TONY CANTELMO
BROKER
TONY CANTELMO

A.D. Cantelmo Property Management
Our Business is Property Management Orange County California


Time to Raise the Rent?

Every Landlord comes to the point when they have to think about raising the rent. It seems reasonable, Property Taxes increase every year, so it makes sense that rents need to increase at least to cover the increase in expenses. Even Tenants would understand that, or will they? If we are going to be honest, none of us want our personal expenses to increase and Tenants are especially sensitive to an increase in rent. Some Landlords write increases into the lease, so Tenants are prepared for it and for large complexes that deal with a large number of Tenants, that may make sense, but for an individual Landlord, it may not. When you put an automatic increase in the lease, it could make it harder to lease a property. Telling a potential Tenant up front that in a year their rent is going to increase could stop a good Tenant from renting the property. So, how do you deal with a rent increase and still keep those good Tenants.

Keeping the Good Tenants Happy

Every Landlord knows that keeping good Tenants Happy and keeping your property filled with long term Tenants is the key to a successful rental business, but no matter how you say it, a rent increase will not make a Tenant happy. I used to be in the camp that if you have a good Tenant who pays on time and does not make unreasonable requests and takes care of the property, it may be better not to increase the rent, but I have changed that way of thinking.

My argument used to be that if you raise the rent by $100 per month, in one year you will earn $1200. If the Tenant decided that the rent increase is too much and moves out, it is going to cost you much more then $1200 to get the property rented again. So my thinking was that it was much better to leave the rent alone as long as the good Tenant remains and then raise the rent when the good Tenant moves out. Over time, I have realized that my thinking was not correct. Yes, I still want to keep the good Tenants happy and I don’t want them to move out, but the reality is, moving is going to cost Tenants a great deal of money also, so if they are happy where they are living, a small increase in the rent will not cause them to leave.

I have found that as long as the rent increase is reasonable and the Tenant is given enough notice that they don’t feel as though they are being blindsided, they might not be jumping for joy at the increase, but they usually will stay. The one risk though is that if they anticipate another rent increase the next year, they may start to look for another place to live when that time gets closer.
The bottom line, keep the rate of increase reasonable and be up front with your Tenant and you have a very good chance of keeping your Tenant for the long term.


   A.D. Cantelmo Property Management
Specializes in Property Management Southern California

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What my clients are saying  

5 reviews 5.0 star rating 1/21/2016 I was tired of using a large management team to manage my investment property. I felt I was always on the back burner. I was recommended to Tony from a business associate, he assured me I would be very pleased. Well that was an understatement, Tony is amazing. He's above all honest and always available for my concerns. I'm not as well versed as other investors with property management and maintenance and tenant relations, Tony has been an excellent partner and has guided me through quite a bit of needed repairs and worked far beyond what was expected to help turn my little investment into quite a prosperous investment, If what your looking for is prompt return calls, honest direction and someone very knowledgeable with general contractors and real estate laws, Tony is your man. Angela

 

~ Angela

5 reviews 5.0 star rating 1/21/2016 I was tired of using a large management team to manage my investment property. I felt I was always on the back burner. I was recommended to Tony from a business associate, he assured me I would be very pleased. Well that was an understatement, Tony is amazing. He's above all honest and always available for my concerns. I'm not as well versed as other investors with property management and maintenance and tenant relations, Tony has been an excellent partner and has guided me through quite a bit of needed repairs and worked far beyond what was expected to help turn my little investment into quite a prosperous investment, If what your looking for is prompt return calls, honest direction and someone very knowledgeable with general contractors and real estate laws, Tony is your man. Angela

 

~ Angela

"10 out of 10 I am so Happy Since I left my old company and I joined AD Cantelmo Property Co I am stress free I live in a different state and this company watches my house and always Mr Tony Cantelmo is on top of things I really want to thank you for what you do for me and I would really Recomend this Company to any and every one Thank You again. Shawn" ------------------- "I need to trust the people I work with and I trust Tony. He stays on tops of things, communicates well, and gets things done. He not only gets things done but he gets things done the right way. Jim"

 

~ Shawn

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