You’ve used the real estate comps to make your profit when you bought. One undeniable part of being a landlord is that from time to it will be necessary to inform tenants of a rent increase.
The tenant, of course, is not going to be happy that they will have to pay more to continue staying in the home. There could be any number of reasons for this: perhaps they can’t afford to pay more, perhaps they don’t feel the unit is worth the increase you are asking. Just know that a rent increase is never what tenants want to hear.
Property owners have a valid concern, of course meaning, that otherwise good tenants might decide to move out and leave the landlord with increased vacancies. Although this might be manageable for properties having many units, an increased vacancy rate for properties consisting of just a few units can be financially taxing to real estate investors.
That being said.
We, the real estate investors, or landlords, are running an investment business that totally relies upon rental income and sometimes having to raise rents is the only way to make it profitable enough to justify owning the units.
Next time, I want to suggest some things for you to consider when rent increases are in order that might help minimize the risk of driving out your tenants.