Raise rent after initial listing?

Question

Hello - We just purchased our third rental property and have listed it. We have met and vetted 3 potential renters ... after the amount of interest we received I am feeling like I listed the property too low. Would it be unethical to tell the renters the situation and if they would be willing to pay $100 more a month? I think I know the right answer I just don't know if there is anything legal about the situation or if I would just scare them all away. Thanks for your responses. Sara

Sara Finley · Answer

@Joe Splitrock I didn't think of it that way... thanks for the head's up! This is why i posted the question in the first place...

Joe Splitrock · Answer

Accept listing something that is not available or changing your price after getting responses is illegal. It is called false advertising. You may not get reported or caught, but why operate your business in an unethical or illegal manner?

Bettina F. · Answer

I have heard of LLs doing "ghost postings" -- they post their rental before it is ready and just gauge the number of phone calls they get. If they are getting lots of calls, they raise the rent in the actual posting-- if no or few calls, they lower the rent in the actual posting. They don't collect any apps or fees.

David Mathews · Answer

I just ran into this same issue. I sure wish that I could have brought myself to increase after getting the responses thst I did but I refrained. But the new tenants may get a bit of a shock at the end of their lease. It'll be a whole year though. So I'm sure they'll understand.

Sara Finley · Answer

Thanks guys! I really appreciate the honest answers! I am going to keep it the same . :)

Deanna McCormick · Answer

Did you take applications .... if not you can repost with higher rent.You say vetted if you ran their application and they meet criteria and qualifications your in the middle of a contract.. and you'd be hard pressed to do anything else but complete the process.

Thomas S. · Answer

You can put them on M2M lease, which you should anyway, then raise the rent in 6 months.

Sara Finley · Answer

Thanks @Bettina F.! That's a great idea!!!

Rob D. · Answer

When I list I don't change the price regardless how much interest I get. I think you're showing how petty and really tacky you are. not to mention it now looks like a bait and switch deal. You could be missing out on a great tenant over $100. Now if you decline all the applicants at x price there is no issue in raising to y price and every applicant aftervthatvis processed at the new rate. I would have no issue with that.As a renter I would never enter in a contract with anyone who pulls such stunt. As a LL I would never do that to someone.I am planning on only doing month to month leases now if any of our rentals become available , but that's more of a hedge against a bad tenant. I have a tenant that signed a mtm years ago and he was worried I was raising the rent after he moved in. So I wrote on the lease a guaranteed no rent raise for 14 months. He's been with me for almost 4 years. Always pays before due date.I did finally raise the rent last month but gave them 90 days notice letter. Truthfully I'll take a on time paying tenant who communicates with me if there is a issue instead and does not destroy my property or violate the lease over a extra $100 a month any day. I have another tenant who has been with me for three years. Rents in the area have skyrocketed. Three years later I finally raised the rent $100. The lady has paid on time every time for three years. And the place is spotless. If she moves out I can literally rent it next day with any effort. I've also had applicants that offered bigger deposits and more monthly rent to be considered or put ahead of other applicants. I tend to dismiss those types and want nothing to do with them.

Jennifer T. · Answer

@Deanna McCormick makes a good point. If 1 or more of the tenant sets have already filled out an application, especially if they already paid a fee for that!, I think you need to stick to the original rental amount advertised. From a moral perspective, I also think you need to keep it the same. At least for those 3 sets of potential tenants. Though definitely change your rental ad to the higher amount for new potentials.Because, here's the thing. A person's time is valuable. They came to look at this rental expecting it to be in $X price range. But now you want to "bait and switch" them. While I realize that wasn't originally your intention, the result is the same. That would infuriate me if I was one of those potential tenants. I don't care how comfortably an extra $100/month would fit into my budget, I would never want to rent that unit from you. You could end up missing out on a great tenant, only to have all the interest suddenly dry up once you raise the rent your asking. I can't speak for your area. But, in mine, a $100/month difference can be a big difference in the amount of interest.