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Updated 5 months ago,
Realistic to raise rents from $825 to $1150?
I inherited tenants in March 2024, who's lease is ending in October 2024. They are paying $825/month. It's a mediocre but not killer deal for me to not renew lease, rehab and rent to new tenants, as I'll make only 8% COC. The market rents on other hand are $1150 as is (this per the appraisal). If I rented it for that amount now, that would be great (12% COC). But is it reasonable to expect the tenants to accept that increase? What are the chances they would actually agree to that? And what is the amount of increase that is reasonable in this situation that a tenant would be ready to swallow?
In short, if it is unrealistic they would ever accept $1150, I would like to know beforehand, as I don’t want to be shooting my sled in the foot. Anyone with experience in this?
thanks