With the growing property rental markets, increasing the monthly rental is a usual practice that owners all across the country follow. Owners usually raise the rent in order to enhance the living standards for the tenant and also for the regular maintenance and repair works that had to be carried out. As an owner, one cannot raise the it overnight and whenever he/she wants to. There are specific rules that the owner should know before he/she increases the monthly rent. Here are some of the basic things that the homeowner should know before doing the same:
Doing it only when the time comes:
Homeowners can legally increase the rent only when the rental agreement is up for renewal after the specified time period. The previous term of lease must come to end before the owner negotiates with the tenant for a rental increase.
From the tenant’s point of view, this rental agreement should be carefully read before signing the agreement. It should have the clause about the increase in rent, the time period and the notice period for the same. For instance, Mr. Raghu has an 11 month rental agreement period for his apartments in Pallavaram Radial Road and he had notified about all the details in the agreement for the tenant to refer and authorize while signing. This makes the whole process simple and easy for both the owner and the tenant.
Reasonable and fair increase in rent:
If the owner increases the rent of a property, it should be reinforced with a proper reason. Some of the valid reasons for the increase in rent are the growth of the rental market in the location, maintenance and repair works that the property needs. Providing good and high living standard for the tenant and also yearly increase in the rent if the tenant passes a year or two. Whatever might be the reason, the owner must always notify the tenant about the rise and the reason for the same. The homeowner should also consider leaving space for negotiation with the tenant.
Proper notification in time is vital:
Whenever the owner decides to increase the rent, he/she should notify the tenant before doing the same. And the owner should also give time for the tenant to think about the rise. The tenant can either accept it or negotiate the rate or move out to a new place. It takes time for the tenant to decide whether to buy a new house or continue to rent. At least a notification 30 days in advance is required for a normal hike of 10% in rent. If the increase is more than 10%, then the owner should at least notify the tenant 60 days in advance. The notification is better to be provided in written form.
Staying in the market standards:
The landlord should not increase the rent too much, with a huge difference in the current rental market rate. And the tenant is allowed to negotiate with the owner if the increase seems to be too much. The tenant should be provided with certain improvements or maintenance repairs in the property if the rent is increased, thereby giving value for the increase.