New to Rental Property: Rent Increase Situation

[David Pearson]

Hi everyone,

My name is David and I purchased my first rental property last month, in the Chicago area. I am out of state and am doing business with a property manager over there. Things have been going smooth with them. They just conducted their initial walk through and the tenants seem to be taking care of the property.

The current tenants had some frustrating experience with the last property manager and have been a little bit defensive with some of our requests. But lately, it's been going well overall.

My property manager wouldn't recommend increasing the rent as the current tenant's lease is ending at the end of the year, and they would like to go month-to-month as they might move to Texas in early spring.

What would be your recommendation for a new real estate investor?

I am thinking that for now, if they are paying their rent, and not trashing the property, it's what I'd want.

Just as a side note, I under estimated the property taxes in the area and won't have much cash flow on the property (below $40 a month after reserve).

Thank you! And nice to meet your all! Happy to be here!

David

[Russell W.]

If the tenant is willing to stay for awhile longer MTM, it may be worth it as Winter can be difficult to find a tenant. Better to have someone paying rent (even if slightly below market) than an empty unit waiting 'til Spring.