How to Write a Friendly Landlord Rent Increase Letter

As a landlord, you will likely have to raise the rent sometimes. We take a look at how to write a friendly landlord rent increase letter.

Maintaining healthy landlord tenant relationships is a crucial part of increasing tenant retention and decreasing costly vacancy periods. This relationship needs to remain professional and fair for both parties - with clear communications given for things like property inspections, online rent collection, maintenance management, and setting a fair market rent.

Generally speaking, these communications should be done in writing so that both parties have proof. Done well, maintaining this relationship will see your tenants renewing the lease for multiple years. However, even if the tenant is renewing, you should do a market comparison to check that you're still charging a fair rent amount.

Increasing the rent a small amount each year is always better than leaving it and having to increase by a large amount later. However, any rent increase can be off-putting. Which is why you should make sure you have a quality rent increase letter that clearly outlines the rent change details so that no one is caught by surprise.

In this article, we take a look at what goes into and how to write a friendly landlord rent increase letter.

When can you send a rent increase letter?

Before writing a rent increase letter, you need to know if and when you’re actually allowed to increase the rent. For example, if your property is located in an area with rent control, such as New York, you’re rent increase options may be limited, even if your tenant is on a yearly lease. Different laws apply to different states, so you need to familiarize yourself with the local and state landlord-tenant law. Make sure you are within the law to avoid potential complications and legal actions.

Do notice periods affect when a rent increase letter can be sent?

Just as rent control laws differ depending on what state you’re in, different states also have varying rules regarding notice periods. For most month-to-month lease agreements, landlords can increase the rent at any time if they provide written notice of at least 30 days. As a landlord, it’s a good idea to consider the timing of your rent increase letter.

For annual leases, landlords will need to wait until the end of the term to make adjustments (unless the terms and conditions of the lease state otherwise). This means that you cannot increase the rent a few months into a tenancy, but will need to wait until the lease agreement contract comes to an end. Even if a lease is coming to its end, you may still need to give 30-90 days’ notice regarding a rent increase.

Things to consider before sending a rent increase letter

Once you have established that you are legally allowed to increase the rent, and when the rent increase letter should be sent (eg. 30, 60, 90 days before the rent increase will take effect), there are some other factors to consider before moving forward.

You will want to familiarize yourself with the current market rates for similar rentals in your area to ensure any rent increase you’re planning is reasonable and fair. Increasing the rent is likely to upset your tenant, and a large increase will often result in the tenant choosing to vacate the property, especially if they believe they can get a better rate elsewhere. An unexpected vacancy period paired with above-market rents will most likely result in

While you, as a landlord, have the final say over how much the rent will be, you should always ensure that the increase you are requesting is fair and justifiable and in line with the rent rates of like properties in the area.

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Writing a friendly landlord rent increase letter

Now that you have confirmed how much you are able to increase the rent by and when to send the letter, it’s time to actually write it. Lay the foundation of a good rent increase letter by using our handy guidelines.

Keep it professional

While you want your letter to come across as friendly and non-threatening, you still need to maintain a professional tone throughout. This means keeping it relevant and to the point, rather than adding too much unnecessary detail.

Personalize it

One way to ensure that your friendly rent increase letter is non-threatening is to personalize it. Acknowledge your tenant by name and recognize their contributions so far, and remind them that you are personally managing the property. Sending a generic letter could come across as cold and unthoughtful.

State the facts

Part of keeping your rent increase letter professional means clearly stating the facts. While your initial reaction may be to soften the blow of the rent increase by overly justifying your decisions, making your letter clear will help prevent confusion between you and your tenant.

This is not to say that you should avoid justifying your decisions altogether. Acknowledging the reasons why the rent is being increased (eg. to keep rent rates in line with market averages) will help your tenant understand why they will be paying more.

Encourage open conversation

A friendly letter is one that is open and honest. If they aren’t already aware, remind your tenants that they can contact you to discuss things further if necessary. Lastly, end your friendly rent increase letter by thanking your tenant for their understanding and showing them that you value their cooperation.

Send it properly

On a final note, the rent increase notice must be in writing; in some states, certified mail is required. Oral notices are ineffective in most states and, unless both tenant and landlord specifically agree to the rent increase, it can be very hard to enforce.

Keeping a record of your friendly rent increase letter

Even if you send your rent increase letter by certified mail, you should ensure that you retain copies for your records. Paperwork can still be lost, misplaced, or a headache if not stored and organized properly.

Using property management software like Landlord Studio will allow you to upload documents to a secure cloud server, keeping you safe in the knowledge that all of your paperwork, from tenant welcome letters to friendly landlord rent increase letters, are easily accessible. Save a copy of your rent increase letter to store digitally, so you always have it on record.

Final words

Writing and sending landlord rent increase letters are part and parcel of the job and if done correctly, can help you maintain a positive landlord-tenant relationship. Instead of being cold and threatening, they can be friendly, reasonable, and fair.

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