Inheriting 4 tenants – strategy for getting up to market rent

[Ari Archer]

Hi–

I just bought my first rental property – a 4plex of 1/1s in the Vallejo, CA area. I'm inheriting 4 tenants, 3 of whom are month-to-month. I'm looking for the best way to get the 3 month-to-month tenants up to reasonable rents. There is no rent control. Should I offer them financial incentive to sign year leases? Should I get them on my leases instead of the previous landlord's?

Some background info:

• Unit 1: $1150/mo – upper unit with view, some recent renovations. on year-long lease ending 11/17.
• Unit 2: $775/mo – upper unit with view. month-to-month, tenant since 9/10.
• Unit 3: $800/mo – lower unit. month-to-month, tenant since 7/14.
• Unit 4: $775/mo – lower unit. month-to-month, tenant since 5/11.

Unit 1 i'm happy with.

Unit 2 looks like the biggest opportunity for raising rent. in it's current condition, it looks like i could get 875-950 for it. after some updating, i could get 1100-1350 for it.

Units 3 and 4 could probably max out at 850. after improvements i could get ~1k/unit.

If they are good tenants i would like them to stay. I certainly appreciate the longevity. any advice would be greatly appreciated.