Free Rent Increase Notice Letter Template
The rent increase notice is a letter provided by the landlord that informs the tenant that the rent will be raised. The letter may only be used for month to month rental agreements unless a standard (fixed) lease is expiring then this letter may be given upon its expiration. After issuing the notice, the tenant has the right to reject the increase and choose to vacate the premises.
A simple Notice of Rent Increase letter will identify the following basic elements:
- Premises:Â address and location of rental property
- Current Rent:Â the amount of money the Tenant has been paying the Landlord
- New Rent:Â increased amount of money the Landlord would like to be paid
- Effective Date:Â when the Tenant must start paying the new rent amount
- Tenant:Â name of the person currently renting the Premises
- Landlord:Â name of the person who owns the Premises
When You Should Send the Rent Increase Letter
If you have a Lease Agreement and the Lease has not ended, check your Lease to see if you can increase the rent. If you cannot increase the rent, you must wait until the Lease expires. You could, however, send a letter 60 days before the Lease ends to give the Tenant advanced warning in case they want to renew the agreement under the new increased rent. If you have had good experiences with the Tenant, you could also waive the increase in rent to avoid the hassle of finding another Tenant.
Check your Lease or local laws for when you should send a Notice of Rent Increase, but a 30- to 60-day warning is typical.
If you do NOT have a Lease Agreement or the Lease already expired, a Rent Increase Letter must be sent in advance, typically 30 to 60 days, depending on state and local laws.Â
Illegal Rent Increases
Landlords have specific responsibilities under federal, state, and local landlord-tenant law. When a landlord-tenant dispute occurs and the landlord increases rent in bad faith (in an effort to force the tenant to move out) it is likely against state law. There are several situations when rent cannot be increased:
- Retaliating against a tenant for:
- Asking for repairs
- Reporting a housing code violation or unsafe, unhealthy, or illegal living conditions to a building inspector, fire department, health inspector, or other agency
- Joining or organizing a tenant union
- Following self-help strategies allowed by their state and local law
- If the fixed-term lease has not expired and does not allow an increase
- Advanced notice was not properly given according to state and local laws
- Local laws on rent control or rent stabilization are violated
- Discriminating against the tenant’s race, religion, or sexual orientation
These laws have been written to protect tenants from various forms of landlord retaliation.
How You Should Send the Rent Increase Notice
The Lease Agreement may describe how letters should be sent. The free residential lease agreement sample, for example, says that Notices must be in writing and should be either:
- delivered in person
- sent by overnight courier service
- sent via certified or registered mail
Sending a Notice to Increase Rent by mail creates a better record than an email or text.
If the Landlord has been in touch with the Tenant by email, another option is to electronically send the letter and send a hard copy of the letter for good measure. Sending a text message is generally not a good way to create a reliable paper trail.Â
How should I calculate my rent increase?
In some jurisdictions, landlords must abide by rent stabilization regulations. Be sure to research the guidelines for increasing rent in your area before you send out a Notice of Rent Increase. After following your local laws, it’s important to ensure any rent increases also comply with the terms of your lease.
Aside from being compliant with landlord obligations, several other factors may influence the rate of a rent increase:
- The rental market in your area
- The frequency of rent increases
- The Consumer Price Index (and the calculated rate of inflation)
- The attitude or behavior of your tenant
To be fair, landlords often increase rent charges by 1–2% to match the rate of inflation calculated by the Consumer Price Index. In addition, landlords who frequently raise the rent (e.g. every year) may only seek a slight increase to avoid overwhelming or ousting reliable tenants.
However, a larger increase (between 3–5%) in rent may be suitable for landlords looking to match the rental market in the area. It may also help offset costs caused by an unruly or troublesome tenant.
Keep in mind, landlords cannot raise the rent to retaliate against a tenant for exercising their legal rights (e.g. asking for the landlord to pay for property repairs).
There are several situations when rent cannot be increased:
- Lease has not expired and Lease does not allow an increase
- Advanced notice was not properly given according to state and local laws
- Local laws on rent control or rent stabilization are violated
- Retaliating against Tenant for asking for repairs or reporting a housing code violation
- Discriminating against Tenant’s race, religion, or sexual orientation
- Rent is increased in bad faith because the Landlord is trying to force the Tenant to move out
Delivering a Rent Increase Notice
You can hand-deliver or mail your rent increase notice, however, if you mail it you will want to utilize certified mail with a return receipt. This will provide you with proof of notice—in case there is confusion in terms of the rent increase and the matter is taken to court.
For fixed-term leases, you can include a copy of the new lease with your rent increase notice. Highlight any changes (like the increase) that have been made to the lease and ask your tenant to review the new lease, and sign it if they agree with the changes.
Your tenant will make their decision of whether to agree and pay the increase in rent, make a counter-offer, or elect to move-out. If your tenant is uncertain about renewing their lease as a result of the rent increase, you can send them information on similar properties in the area to show that you have done your research and the rent increase is a fair amount.
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