You never want your rent to be increased. But, it does happen. So if you are wondering under what circumstances a landlord can increase rent and what laws they need to follow in order to increase a tenant’s rent then continue reading. As a tenant you can have some peace of mind knowing that your landlord is not allowed to just increase your monthly rent at random, there are certain procedures to follow and a tenant needs to be well aware of the future rent increase prior to the rent going up.
When a tenant has signed a lease/rental agreement the price of the rent will be stated in the lease. However, at some point during the stay in the home/apartment building a tenant will be subjected to a rent increase. It is just part of the process and how the rental industry works overall. There are many reasons as to why a tenant may be subjected to a rent increase and we will go over everything in this article so that you have a good understanding of the rent increase process.
When is a Landlord Allowed to Increase Rent and How Do They Go About It?
If you live in a state with rent control then you do not need to worry about rent increases too much. If you do not live in a state with rent control then a landlord’s right to increase a tenant’s rent will depend entirely on if the tenant has signed a lease/rental agreement or is paying their rent on a month-to-month basis.
If a tenant has signed a lease/rental agreement then a landlord does not have the right to increase the rent until the end of the lease period. The exception to this is if in the lease agreement a calculated rent increase has been stated or the tenant agrees to having the rent occasionally increased.
In the situation where a tenant is paying for their rent on a month-to-month basis then a landlord is allowed to increase rent at any given time, provided that the landlord gives the tenant proper prior notice before making any rent increases. The amount of notice that a landlord needs to give the tenant is usually 30 days prior to when the new rent price will take effect. This 30-day notice rule also applies to any other changes in the rental arrangements, so if anything needs to be changed with regards to any rental agreement then a landlord is required by law to give the tenant 30 days prior notice.
This rent increase change needs to be in writing and in some states certified mail is also required. It will not be good enough to just give a verbal agreement when it comes to an increase in rent and unless the change is in writing, the tenant will not be obligated to comply with it and pay it.
What if a Landlord Increases The Rent Without Prior Notice to The Tenant?
What if a tenant is living in a rental unit for some time and then suddenly gets hit with an increase in rent without being given prior notice by the landlord? What happens in these situations and is it legal for a landlord to do this?
If a tenant is renting out the property unit on a month-to-month basis then it is not as big of a deal compared to if you had a lease/rental agreement that you have agreed to. If a tenant is on a month-to-month rent basis and is suddenly hit out of the blue with an increase in the rent amount then they have 2 options. A tenant can either just go with it or fight for their right to continue paying what they were paying in rent.
Most people will opt to just pay the new rent amount in these situations. It will not be beneficial for you to try and fight for the old rent price as the landlord in most situations will have a very good reason as to why the rent has now been increased. This way the tenant will continue to have a good, solid relationship with the landlord and will be on good terms going forward. If a tenant believes that the increase in rent is not reasonable then they have the right to fight it.
If a tenant has now agreed on the new rental amount then it is always a best practice to get everything in writing so that the landlord cannot simply increase the rent even further or tell a tenant that they have paid the incorrect rent amount and need to pay more. If you are on a lease/rental agreement then it is best to get a new lease agreement drawn up which states all the new changes to the rent amount. This keeps both parties happy in the long term.
A Rent Increase Due To Retaliation and Discrimination
In short, a landlord is not legally allowed to increase the rent due to retaliation or discrimination. If a tenant files a legitimate complaint against the landlord and does so with the correct procedure, then by law the tenant is covered from a rent increase due to this fact. It will be illegal for a landlord to try to increase the tenants’ rents as retaliation to this complaint so a tenant can have some piece of mind knowing this.
When it comes to discrimination, a landlord is also not allowed to discriminate against people based on the color of their skin or their sex. The law states that rent and rental/lease agreement terms need to be equal for everybody. So you do not need to worry too much about having an increase in rent due to discrimination. If your landlord does however decide to discriminate against you then you have every legal right to file a complaint and take the landlord to court to fight for your equal tenant rights.
How a Rent Increase Affects a Security Deposit
If a tenant is subjected to a rent increase then they will also be subjected to an increase in their security deposit. We have, in other articles, covered how a security deposit amount is calculated, so if you would like to read up on that then head over to this article to read more about security deposits. Let’s go over an example so that you have a good understanding on how a security deposit will increase due to the rent increase.
If for example a tenant’s security deposit is calculated as twice their monthly rent and then a landlord decides that the rent should be increased from $1500 per month to $1850 then the tenant’s security deposit will increase from $3000 to $3700. This is just an example to show you how the security deposit will be affected with an increase in rent.
The Frequency At Which Landlords Can Increase Rent
A landlord cannot simply just increase a tenant’s rent whenever they feel like it, especially if the tenant has signed a lease/rental agreement. In that situation, the landlord would have to wait until the lease has expired before making any changes to the tenant’s monthly rent. This however only applies by law if a lease/rental agreement has been signed. If the tenant is paying their rent on a month to month basis then the landlord has a bit more flexibility on how often they can increase the tenants rent. Also if a tenant is paying their rent on a month-to-month basis then take note that the rent cannot be increased by the landlord before the end of any given month and a landlord also has to give 30 days prior notice about the rent increase to the tenant before making the change. This gives tenants some time to get their finances in order before any increase in rent goes into effect.
The rent increase is always governed by the rent control that is enforced by the state. So if you are living in a state that has rent control laws then you do not need to worry too much about your rent being increased out of your housing budget. If you do not live in a state that has rent laws then you just need to make sure that the increase in rent is reasonable for what you get out of the property unit. An increase in rent also does not have to be final, a tenant has the option to negotiate with their landlord to come up with the best possible solution for both parties concerned. This is why it is super important as a tenant to be as upfront and honest about your financial situation as possible.
The Rules Regarding By How Much A Landlord Can Increase Rent
If you have been renting out homes for any period of time then you will know that rent increases are just part of life and landlords needs to periodically increase a tenants rent to be able to keep up with maintenance on the home and make sure everything is in order so that the tenant has the best possible experience during their stay.
If you are living in a rent controlled state then a landlord cannot increase a tenant’s rent by any amount, they have to stick to a certain set of rules and guidelines. However, if you are not living in a rent-controlled state then by how much a landlord increases a tenant’s rent is totally at the discretion of the landlord. There are no set rules and a landlord can increase a tenant’s rent by an amount that they choose.
When it comes to whether a tenant will accept the new increase in rent price or not is out of the scope of this article but every tenant will react differently when their rent is increased. Like we have said most tenants expect the rent increase and typically do not have a problem with the increase as long as the rent increase is within reason and within their housing budget for the month and year.
Loss of Tenants Due To An Increase In Rent
Money is a very touchy subject, especially when it comes to rent and paying for housing in general. Most people want to be able to live in a nice home that is safe and a happy place. Tenants can get attached to their current home. So when they are slapped with a rent increase, not all tenants will take it that well and as a result some landlords will lose tenants due to a rent increase.
Most of the time landlords increase the rent not for their own financial gain but because they need to be able to sustain their rental business and increases in rent periodically allows landlords to do that. Some landlords will however try and take advantage of this and overcharge on the rent increase and as a tenant you will want to at all costs try and avoid these types of landlords as best you can.
We have covered a lot in this article about everything that goes into an increase in rent and we hope that all your questions were answered and you now should have a pretty good understanding on all the different aspects that go into a rental business from both the perspective of the tenant as well as the landlord.
If you are currently renting a home or apartment then this information will be very beneficial to you and if you are looking to rent in the future then we hope this helped you out as well.
If you have any further questions or concerns then feel free to get in contact with us any time and we will do our best to get back to you as soon as possible. With many years of experience in the rental industry we are more than qualified to assist you and give you the answers you are looking for and thanks for putting your trust in us.