Pricing strategy for 1 bedrooms

[John Warren]

Hello everyone!

My wife and I purchased a fourplex last May in a near southwest suburb of Chicago. The first lease is about to expire at the end of the month, and I have to figure out how much we should raise rents! Currently our units rent for between $550 and $695 per month. The $550 rent was for a guy who was doing the "maintenance" before we purchased the building, and he will no longer be doing any maintenance now.

Rents in our area appear to differ widely based on the amenities, but I just viewed an apartment another landlord is leasing for $765 per month that is no where near as nice as ours! Top rents in the area appear to be around $850 per month for nicely finished apartments. Our apartments have in-unit laundry and dedicated parking. The laundry especially is a nice feature in this C+ neighborhood.

My wife feels that we should raise rents immediately, but I am not sure if a rent increase will be worth an immediate vacancy. Everyone is paying on-time (even early!) and the building is cash flowing $150-200 per door per month at this point. What would you all do?