?Renew for chronically late tenant?

[Stan F.]

I am trying to be objective. Long term inherited tenant who is about $150 below market. He is late 6-8 months out of 12 months. He pays with late fee. Yes my late fee is low $35; I plan to address it in the new lease but I ma trying to think if I should renew or not. I usually always increase rent 2-3 percent to not be too much below market but I am afraid that may be I hit max with this tenant and at this point either settle for what I got or I go fishing for new tenant. Place may need about $4-5k in remodel which I have in reserves ( new stair carpet, painting, some bathroom remodel). 

Thank you in advance for input.