The Rising Costs for Landlords

[Terra Padgett]

All landlord expenses have certainly risen. Taxes, Insurance, HOA, etc. It's been estimated to be around a 20%+ increase in 2024 alone. So it's inevitable that rents will/would/should go up.

📌 How much have your expenses increased?

🖊️ Which expense has been the biggest jump?

✏️ What tips do you have for the community to help control or lower those expenses?

[Mike H.]

Insurance has been the biggest jump for me with taxes right behind it - especially taxes here in illinois.  Other areas like tennessee the property taxes are so nominal that a 10% increase would be like 100 bump a year if not less so that one is very market specific.  Here in illinois, a typical tax bill for a 200k house is 6k.  So a 10% increase is 50/month in expenses. Its tough here.

But here's the other thing. Our expenses going up do not equate to the ability to raise rents.  thats not how it works.  Rents are driven by supply and demand and by the ability of renters in that market to afford the rents.

Its much like someone that over-rehabs a house and then says that they need to sell the house for 20k more because thats how much they went over budget.  The market is what the market is so that 20k more is a loss.  

We can't raise our rents just because our expenses went up.  Much like we were able to raise our rents significantly over the last few years (far more than our expenses went up during that time) because the market allowed us to.