Under market rental rates

[Toi Perry]

My rental properties I recently acquired are renting at about $635 well below the rental market of comparable properties $750. I want to raise the rent but the tenants have not given me any issues although I know they are paying way too low.

Each unit is 2bed/1bath w/garage & laundry included

Utilities included: Water (not individually metered this is a triplex)

Conyers, GA

Should I raise the rent to a competitive rate (maybe $700) so that they will more than likely stay or should I just increase it to the market rate $750?

Thanks for all advice.

[Kelly N.]

Hello Toi,

I would (and have) raised rent to at or close to market prices in stages like you are talking about.  I think going to $695 or $700 would be fine, and plan to increase to $750 for a new tenant moving in.  You want to increase your profits without pushing them out the door, and my guess is that if you give them a couple of months notice before the rent increases, they will look around at what is available and realize they have it pretty good where they are at and they won't want to move. 

The next thing to consider is if there is anything you can do to justify the increase in rent- any repairs that have been put off or aesthetic items that could improve the property- some landscaping or a coat of paint can do wonders.