Raising rents 12% to market rents?

[Ally Kumar]

I have heard general rent increase of 3-5% every year if tenants are renewing their lease. However, rents have gone up about 12% since last year in my area. Is it advisable to raise the rent to market rent (or slightly under rent since these are good tenants) or does traditional increase of 3-5% is more reasonable? Whats the recommendation if rents are going up significantly? Thanks for your input.

[Jon Ree]

I agree. I like to reserve significant rent hikes for when one tenant moves out and a new one moves in. We have had similar rent appreciation here, but I like our tenants so I haven't done any big bumps. Since I self manage (and work full time) that's more important right now.