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Erin Eberlin is a real estate and landlord expert, covering rental management, tenant acquisition, and property investment. She has more than 16 years of experience in real estate.
Updated on May 10, 2024 Reviewed byThomas J Catalano is a CFP and Registered Investment Adviser with the state of South Carolina, where he launched his own financial advisory firm in 2018. Thomas' experience gives him expertise in a variety of areas including investments, retirement, insurance, and financial planning.
Landlords must often follow specific legal procedures when increasing a tenant’s rent. The two major requirements landlords must follow are, providing the tenant with written notice of the increase and giving this notice a certain number of days before the tenant’s lease is set to expire.
Below you will also find a sample letter of how to inform a monthly tenant that you are going to raise their rent.
It can. Many states set a maximum amount a landlord can charge as a security deposit based on the monthly rent. For example, the security deposit could be two times the monthly rent. Therefore, if the monthly rent goes up, the landlord could require the tenant to put additional money toward their security deposit. This additional amount would usually be due at the same time the rent increase takes effect or when the tenant signs a new lease. Sometimes, the landlord will not ask for additional security deposit money even if the rent is increased.
A landlord cannot increase a tenant’s rent whenever he or she feels like it. There are certain steps landlords must follow to raise the rent. This process is meant to help protect the tenant from ridiculous and unfair increases.
1. A rent increase cannot occur during the lease term. Unless the lease agreement specifically says otherwise, rent increases are not allowed during the lease term. The tenant signed an agreement to rent the property at a certain price, and this price will remain valid until the lease expires. A landlord can propose a rent increase when a new lease agreement is due to be signed or after the original lease has ended and the tenant agrees to an extension under new terms.
2. Landlords must provide written notice before the increase. If a landlord wants to increase a tenant’s rent, the landlord must send the tenant a written notice. This notice can be hand delivered or mailed to the tenant. It is always a good idea to send this notice via certified mail so there is a record that the tenant received it. Notifying a tenant orally of a rent increase will not hold up in court.
3. Even for monthly tenants, landlords must still provide adequate written notice. For month-to-month tenants, it is common for a state’s law to require the landlord to provide notice either 30 or 60 days before the rent increase is set to take place. The amount of notice needed will often depend on the percentage that the rent is being increased. In California, for example, if the rent will be raised by 10% or more, 60 days’ notice is required.
4. The amount of the rental increase is also subject to rules. A rent increase must usually be considered reasonable, as determined by the local rental market. A landlord often doesn't want to lose a tenant and increases the rent to have a bit more money to cover expenses. Increases may be used to cover growing real estate tax bills and insurance premiums. If a property is rent-controlled, there are specific rules as to how much a rent increase can be and how often the landlord can increase the rent.
5. Tenants can fight illegal rent increases in court. If a tenant feels the landlord is increasing their rent as an act of retaliation or discrimination, he or she can take the landlord to court. An example of a retaliatory rent increase would be a landlord increasing a tenant’s rent because the tenant complained about a potential health violation at the property.
6. Tenants have the right to reject rent increases. A tenant does not have to agree to the rent increase. However, if he or she does not agree to pay the higher rent, and it is a reasonable increase, the tenant must move out of the rental unit. If the tenant stays in the rental unit once their old lease expires, they will be responsible for paying the new rent or else be subject to eviction and legal action.
Name of Tenant
Address of Tenant
Unit Number
This Notice is to inform you that beginning on, Insert Date of Rent Increase, the monthly rent for the unit you currently occupy, Unit Insert Unit Number, which is located at, Insert Property Address, will be increased to Insert New Monthly Rent per month. This rental payment is due on or before the 5 th day of each month.
If you wish to continue your tenancy, the new monthly rental payment of Insert New Monthly Rent is required. Please be advised that all other terms of your original rental agreement remain in effect.
Please sign the Notice below, indicating your agreement and continued tenancy or indicating your disagreement and subsequent termination of tenancy.
Thank you. We appreciate your continued tenancy.
Landlord’s Signature:_________________________ Date:______________________________________
___I agree to the new monthly rent amount of Insert New Monthly Rent beginning on Insert Date of Rent Increase and will continue my month-to-month tenancy as per our original rental agreement.
Tenant Signature:__________________________ Date:___________________________________
___I do not agree to the new monthly rent of Insert New Monthly Rent. I will not continue my month-to-month tenancy and will vacate the premises by Insert Move-Out Date according to the terms of our original rental agreement. (See Also: Sample Move-Out Checklist)
Tenant Signature:________________________________ Date:_________________________________________
