Hi everyone, I know this question has been asked many times before, but I need to settle a disagreement with my wife so I am unfortunately asking it again. I apologize for the length of this post. Please bear with me. I am at my wits end.
My wife and I own a fourplex. It is fully rented and 3 of the 4 tenants have been there for several years. The other tenant has been there for 3.5 years. They are all paying $775 per month. Similar units in my area are going for $1,150 minimum. The average price seems to be $1,200 but there are a few posted once in awhile for $1,150. But for the past few months I have never seen a similar unit listed for less than $1,150.
My wife and I agreed that the rent is too low and we must raise it, but we do not agree on the price. I want to raise the rent to $1,000 and she wants to raise it to $950 or even $900. Her argument is that she does NOT a want to lose any of the tenants. My argument is that even though the increase is big, it is still $150 lower than what literally everyone else in a 100 mile radius is charging. She says I am being greedy and that if a recession were to happen, we would be lucky to get $300 rent for these units. I disagree.
All 4 tenants always pay the rent on time and take excellent care of the units, which is why I don’t want to raise to full market as I don’t really want them to leave.But my wife is terrified at the thought of any of them leaving to the point where she doesn’t want to raise it more than $950. She prefers we only raise the rent to $900.
We’ve had 3 vacancies in the last 3 months and we do all the cleaning, painting, and minor repairs ourselves. She says she is exhausted and doesn’t want to deal with another vacancy. I get that, I’m exhausted too. But it hasn’t been so bad. Our longest vacancy has been 6 days these past few months and it takes us about 2 weeks to get the unit back to the way it was before the tenant moved in. And it hasn’t been very hard finding highly qualified tenants to fill the vacancy either. I argue that with the increased income we could afford to hire someone to clean up the vacant units and do the work for us. She didn’t have much to say on that issue after that but she’s still fighting me hard on the price increase. She is convinced a recession is coming and says we we lose all of our tenants when that happens because everyone will be broke. So best keep the price low now so they won’t leave us later in a recession.
I am ready to give up at this point because I’ve tried so hard to get through to her. I’ve shown her all my research and just when I think she’s about to finally agree with me, she throws ‘recession’ in my face. So now I will go off to research how rentals fare during a recession.
But first, can anyone please tell me if raising the rent from $775 to $1,000 is a good idea or not? Am I being greedy? Or am I being foolish for not raising it even higher to be a bit closer to the $1,150 market rent? Is an excellent tenant worth missing out on $9,600 a year?
