Existing tenants paying way below the market rate. What to do?

[Tarun Mitra]

I have just bought a new duplex. I have existing long term tenants living in each unit. One tenant is living there for 10 years paying around 1080 and another is living there for 4 years and paying 1265. The current median and average rent is above 1650 according to rentometer and zillow. I bought the property thinking I will be able to increase the rent and bring it to the market rate. But if I increase the rent for tenant_1 to even 1400 it is like 30% increase. I definitely want to bring the rent up to 1550 at least and then gradually increase it to the market rate. I am not sure how to go about this rent increase. I just started being a landlord and this is my first property. Can you guys suggest how should I increase the rent here? Today is my day 1 of owning this property.

[Bjorn Ahlblad]

@Tarun Mitra Congrats and welcome to BP! First check the leases and end dates. Second check to see if the City or County are enforcing rent control and if it applies to your type of property. If your objective is to raise rent and you don't care about turnover give the tenants the required amount of notice-usually 30 days to pay the new rent or leave.

If you want to keep the tenants, have a talk with them and see if there is a compromise in there someplace. Tenants are usually quite aware of market rents and will know they have been getting a bargain. All the best!