Why you MUST increase your rent
HTML-код
- Опубликовано: 1 июл 2023
- Landlords: we have a problem…
The dreaded rent increase conversation.
Most of us put it off, but doing that has long-term negatives effects for both you and your tenants.
So how can you make it positive for everyone? Hit play to find out.
Links mentioned:
Why the rental market is in turmoil: • Why the Rental Market ...
📩 Keep up with the latest market developments with our weekly newsletter that 70,000 investors receive: propertyhub.net/pulse
And if you missed our video on the BIG changes that might be coming your way as a landlord, go watch this now: • Is this the biggest sh...
#propertymarket #rental #rentincrease
--------------
We’d love to hear what you think in the comments below. You might even have a topic you’d like us to cover in the future - if so, comment it below.
Join in the conversation with other like minded people on our forum: propertyhub.net/forum/
Book onto one of our FREE goals webinars:
propertyhub.net/action/
🔔Subscribe for more FREE property education: / propertyhubuk
🖥 Check out our WEBSITE for FREE property education: propertyhub.net/
📖 Subscribe to our bi-monthly magazine: propertyhub.net/magazine/
🏠 Want help building your property portfolio? Book a free strategy meeting: propertyhub.net/invest/invest...
👨👧👦 Our Social media
📷 Instagram: propertyhub...
🐦Twitter: propertyhubuk?lan...
👍🏻Facebook: / propertyhubuk
📩Linkedin: / thepropertyhub
Listen to our Podcast:
🎤iTunes: podcasts.apple.com/ie/podcast...
🎤Spotify:open.spotify.com/show/3S6fhYX...
My mortgage is fixed till 2027 on low interest. My tenants have NEVER missed a payment in 7 years and paid all through Covid. I cannot and will not increase the rent, I could not sleep at night doing it to them.
I'm also still in a high paying PAYE job so don't need the cashflow yet until I retire. The mortgages are getting paid so i'm happy. I've even offered to sell them but they are happy renting.
If your mortgage payments were to go up say 250% like mine will next year if rates stay the same would that make you act differently?
@@davidjohnbarnard I guess If I make a massive loss then yes I would discuss the options. Fortunately I don't have that problem My LTV is low so in 2027 I will probably pay them off. I intend to retire around 60-62 depending on my pension so these properties will be sold. around 6-8 years.
@@pataleno 😁
It should be free. You are greedy
@@johnbuffaloiam9741 lol what should be free ?
There will be an issue for landlords who haven't increased over last few years when they come to remortgage, as they may find the rents are too low to pass the latest affordability tests with higher rates.
My policy is to set rents at or just below market rent when a new tenancy and don't increase for first couple of years. I'll then increase the rent by, at most, the local market percentage increase, but always keeping them below the market rent as something of a loyalty bonus - always annoys me when mobile providers etc want to charge me the same as I can get as a new customer and don't see the rental market as any different. Additionally, if a tenant does move out, I'm going to lose at least a month's rent, have to pay the agent a fee for the new tenant and do a bit of maintenance, so definitely best to keep a tenant, even if they're paying less than the market rate.
Mao had some good ideas about landlord
Hmmmmm, I am 50/50mon this. I see your point though. I’ve been renting the same property now for the last 12yrs. My main focus when I moved in was a short-term plan as I was going through a separation, had the idea I would move back to Canada, however my children and their mother moved to Sweden. So I got conveniently stuck.
After the second year I helped the land lord out buy telling the letting agency I moved out, saving him money on the service. He left my rent alone and kind of forgot about it for a number of years. He did not think I would be there long, and I was thinking of buying the property in the initial years which I probably should have done, but hey, hindsight! He knows he would never get a tenant like me, I have looks after the place, the only major things he has done since I moved in is upgrade the two windows in the flat, the patio doors should have been done as that contributes to the most heat loss and changed the boiler when it broke down. If I move out tomorrow, he could rent it straight away as is.
Now he as had the Property since the mid 90s, almost 27 years, I can pretty much guarantee that the property is mortgage free. Based your your argument, what would be your view here? Most of the people I know in my situation have told me that their Landlord has left them alone, as long-term tenants.
The building I live in has 17 flats, and I have seen the prices if these flats rise and fall, with big differences. Some clearly sold too high and one earlier this year sold 70K cheaper than the most expensive one, same flat, opposite the hall fro each other. In terms of rent, one landlord. Had his rent so high, the people did not stay long and the flat stayed empty for month, inexperience I guess. There does need to be a balance an it is finding it. I am about to inherit a property with my sister, do I rent it out, sell it and use the funds to buy a property and rent it, or get on the ladder myself?
Great channel,buy the way, oh, and my landlord is super cool guy…
You mustn't put off increasing rents, otherwise they'll fall ridiculously below market rates, and your investment will return less than it could. That's not good management.
I never had any 'conversation' with my tenants, I simply sent them an email containing a rent increase notice, and it was up to them to accept or move elsewhere. That said, I was never one to jack rents, usually raising them only every 3-4 years to catch up with inflation. You don't want to price your rentals aggressively, but you also don't want to be giving them away.
I'm one of those renters, except the landlord has done zero repairs etc in 12 years, no shower, dishwasher, oil thats turned in at switch box. The landlord can jump if wants to increase rent.
You need to keep a record of the communication.
Not paying rent can lead to an eviction.
I guess you don't have a shower or did you fix yourself ?
Dishwashers are your problem not the landlords.
I think that's fair.
Rent increase? Fix the issues first. Then talk.
@pattyheno if its supplied with the property then its the landlords responsibility.
How much are you paying below market each month - for example - are you paying £200 less than market rate each month? Why not adjust the budget and take your monthly savings and put them into making the home nicer?
@@marcus.H That way, when evicted the landlord won't have to spend on doing it up for the next tenant - whose side are you on? Better: Take that extra and find a place with a working shower.
What some landlords fail to realize is critical. Reaching the peak of market rates will impact your rental void periods, haemorrhaging more capital and stress in the process. The reality is BTL unless you got a huge deposit with low rates locked in, you're going to be screwed for the next years ahead. If you want to really increase the rent, can you get a different profile e.g. from students to young professionals? Then you got invest to bring the place up to justify the increase. Our current tenants pay below market rate. Take care of the place immaculate, no void periods.
Mine tried to increase mine but it wasn't in line with the local market so we agreed on a middle ground. I think this is the risk you face with the BTL interest only mortgage model, what I often don't hear factored into the equation is the capital appreciation on the property.
Capital appreciation is difficult to measure because it's very unpredictable. Houses can actually fall in value for years, even over a decade. I can buy a flat for less today than it was almost 20 years ago if I buy up North. It's not always clear if the market will rise or fall
housing depreciation** for the next 2-3 years at least.
Exactly, yet there are scores of property influencers still selling courses on how to execute this model despite the high interest climate and inevitable price decline
If you live and buy in the North East of England there has been fuck all capital increase between 2005 and now in terrace houses which are 70% of all rentals. Bought terraces in 2005 125k by 2009 100k. Now 100k again. Timing, timing, crystal fucking ball.
@@williamlyons3947 that's a losers mentality. From what I observed visiting San Francisco and LA. Its seeded its own demise through stupid policies and bad politics. Businesses moving out due to homeless stealing etc is no surprise as I saw even toothpaste under security lock...
A lot of tenants decline rent increase. Glad i charge market rate. Eviction increasing as a lot of landlords not covering costs.
My letting agent just called to say they want an extra £105 a month ...I told them to fuck off lol
Home owners are making record profits
In London I think it is prudent to increase rent because if sadique gets his way (labour
Likely to win next year) rents will be frozen, so need to manage this risk especially in light of mortgage rates and inflation
I’ve not increased any of my rents, they have been good with me and I want them to stay… I will bite the bullit and make less money for a while, the tenants have rising bills so asking them to pay more would not be fair, I’m still making money so I will cope with it,
Increase your rents. Your not doing yourself or them a favour. Did the same and as I sell out of this shit storm my ex tenants are getting a major fucking shock. For a few I'm ecstatic. They deserve the shock but for most its very sad and brought on by these self serving wankers being paid extortionate salaries in shelter.
I had this conversation with my tenants a year ago, they refused the necessary increase they are now being evicted ... as a private landlord running on a tight budge I have no intention of becoming a social landlord ... my property is far superior to any council or LA property, my tenants could not never afford to buy the property themselves and if they want to live there they must pay the going rate to live in a superior well maintained property in a good area with good schools!
Youre exactly what is wrong with the housing sector. Money grabbing!
I tend to keep my rent on the low side. This means the tenants stay longer term and I don't keep getting gaps in payments with regular changes in tenants.
It also means that when I get good tenants they care for the place and my costs are lower.
Finally, having decent relations with my tenants means I get less hassle. They even do minor repairs.
@@angiehaddington6462perhaps you should work an extra job. Do overtime for 5 years. Save up a deposit, then after you pay tens of thousands to cover deposit, solicitors fees, stamp duty taxes and have to carry lots of debt, see if you feel comfortable being told what you can or cannot do with the property you have worked so hard to buy
What exactly is wrong with someone deciding his house is worth the fair market rate?
@@angiehaddington6462if I turned up at your door demanding you provide me a home at your expense because I feel you owe me it, would I be welcomed with open arms? Or would you say "I'm not able to provide social services for you at my own expense. I'm not the government"
If someone wants a luxury house in a nice part of town, that will cost them. If they don't want to pay, no one will simply give it them. No one owes them
@angiehaddington6462 these "you greedy landlords are what's wrong with the housing market" comments are so pathetic! Jeez.....imagine Tesco/Primark/EE/Domino's Pizza/ANY other business held all their costs down at their own expense to make life comfortable for everyone! Why do you fail to realise that being a landlord is providing a service, just like any other business. Why is it that every other business on the planet is expected to raise prices in line with costs but landlords are supposed to absorb them?! I would argue that the landlords that haven't been putting rents up by the going amount on an annual basis are what's wrong with the rental sector because now its an expectation that rents should stay the same. Do business properly and professionally (that includes being a responsible landlord too, before you moan about that!) or don't do it at all.
The missing piece is what you consider “market rent” is not the true market and is artificial due to apartments being vacant and various other factors
This myth about apartments being empty is ridiculous. Theres an negligible percent of apartments empty and those are million pound flats in london. Its a minuscule percent.
@@Kaa567 it depends on the area here in atlanta Georgia downtown area it’s around 20%.. apartments are giving away 1 and 2 months free or waiving fees to try and get people in instead of actually lowering rent just to keep the market rent high
Increasing rents due to credit costs is not necessarily a good idea when you are competing with landlords who can buy outright with falling house prices
Depends on the local market, and how your rent is compared to comparable properties.
I didn't increased the rent. I feel sorry for my tenant. I feel like how one family pay 1550. When average income is 2000. Unless they sublet. But my mortgage gone up and I have to increase the rent.
Sell.....
Lol, can’t believe you’re trying to sell an increase of rent would be a good thing for the tenant due to a shock of the increase. Why should you pass your increased interest rates onto the tenant? Did you not consider the risk to your investment when you took the mortgage out?
He is simply saying you should charge a fair market rent at all times
An incredible amount of self justification in here, making it feel like you're doing the right thing when in reality these actions are purely to line your own pockets. Hopefully we'll see who is wearing no clothes.
I stopped listening to your takes when on your spotify podcast two weeks ago Rob advised without any retort, to maximise leverage, and claimed the current housing crisis is a non-event that no one will remember 10 years from now. I was gobsmacked. Didn't know whether to laugh or shout at the radio. Irresponsible, dangerous, baffling advice to be giving to impressionable people that look up to you.