6 Tips for Communicating Rent Increases

Property Management

Raising rent prices – when market conditions warrant – can be an effective way to increase the return on investment of a rental property. With inflation on the rise, raising rents might even be necessary to maintain a positive cash flow. You should, however, also consider the impact a rent increase might have on your tenant and how to effectively communicate the increase to avoid turnover and a costly vacancy.

Here are a few tips to consider when preparing to communicate a rent increase with a tenant:

1. Understand market rent.

Understanding the market rent is crucial when raising rents. Having an idea of rent prices for similar properties in your area will help you gauge what you could be charging for rent. Talking with professionals who are familiar with local market conditions can yield insight into rental rates and activity. Utilizing an online tool, like Rentometer, for current rental market information can also save you time researching the market rent. Aligning your rent prices with market rent will help ensure you’re charging a fair rent for both you and your tenants.

2. Be aware of local laws.

Depending on your location, there may be laws that dictate when you can raise rent, by how much, or when you’re required to notify your tenants about the increase. Check your state’s landlord-tenant laws or work with an attorney to make sure you’re complying with the laws in your area.

3. Provide written communication.

Always provide written communication when you’re informing tenants of important matters regarding their lease, including a rent increase. While communicating face-to-face is a great way to build a relationship with your tenants, having a paper trail with dates is extremely important as a landlord in the event that you have to go to court. Always follow up with an email or a formal written letter after verbally communicating with your tenants about changes to the lease agreement.

4. Provide plenty of notice.

Providing plenty of notice to your tenants will help maintain a good relationship with them. Any decision made involving housing is a major life decision and can take a lot of your tenant’s time and resources. They’ll appreciate having ample time to consider their options. Typical rent increase notice periods are 30 or 60 days prior to the end date of the current lease. We always recommend staying up-to-date on local laws or working with an attorney to ensure you’re in legal compliance.

5. Show them the data.

Provide your tenants with the rental comparison data that supported your decision and explain how your new rent rate is competitive for the rental property’s area. Your tenants will appreciate the transparency and will be more understanding if the data justifies your rent price decision.

6. Make reasonable rent increases.

If you want to remain in good standing with your tenant, it’s important to make reasonable rent increases. For example, if you perform market research and find that you’re charging 10% below market rent, you should consider implementing incremental increases. Instead of raising rents by 10% all at once, you can instead choose to raise rents gradually by 3% each year for the next two years and then by 4% the third year. By following this method, you will be less likely to upset your tenants and experience turnover.

How a Real-Life Investor Communicates Rent Increases

Real estate agent and investor, Aaron Flake, describes how he communicates a rent increase to his tenants:

“With landlords’ expenses going up nearly every year, a rent increase should be expected. If you communicate the increase in your expenses, [your tenants] are more likely to be understanding…Do small rent increases to keep up with the market. Your good tenants are less likely to leave if the rent increase is $50 than if it were $200. That’s why it’s important not to fall behind the market.”


Increasing your rent prices can keep your rental competitive in the market while maintaining or increasing your ROI. Increasing profit is always important, but maintaining a good relationship with your tenants and treating them fairly should also be a priority as a landlord. If you go about this process the wrong way, you may risk having a vacancy which can be even more costly than having an underpriced rental. To increase rents and retain your tenants, consider applying these tips and strategies. Good luck and rent on!

This article was written by the Rentometer Content Team. The Rentometer Blog features fresh takes and insights on rental housing topics, services, and technology.

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