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Income Realty Inc Blog

Raising the Rent on Your Miami Rental Property

System - Tuesday, July 16, 2019

income-reality-miami-raising-rent

Florida has no strict rule on rent increase notice and Miami doesn't have any local laws applying to rent control.

But, there are still other guidelines to keep in mind regarding for example:

A) When to raise the rent in the first place.

B) The right and wrong time to raise your tenant's rent.

In this article, you'll learn about how and when to raise the rent of your Miami rental property.


What are the reasons for raising the rent?

Let's take a look at some of the possible reasons why you'd need to raise the rent:

Improvements

Remodeling and other significant improvements justify an increase in rent. Improvements increase the property's value. The monthly rent should reflect this change.


Higher expenses

Insurance fees. Property management costs. Taxes. There are many expenses that could increase during the tenancy. Whatever the expense, you need to increase the rent accordingly.


Market situation

apartments-homes

Check the rental prices in the area. If you notice that similar properties ask more, reconsider the monthly price you charge.


Tenant move-out

The period between two tenants is the most popular time for raising the rent. Take a look at the market and consider increasing your rent price.


What should I know about raising the rent in Miami?

Some states have strict rent increase laws. Florida isn't one of them. You can raise the rent with limited notice. Usually, you aren't able to raise the rent on a lease that's for a year or more. That is, until the lease ends which is stated in the lease agreement. However, agreements do exist that have provisions about rent increase during the tenancy period.

A month-to-month agreement renews at each month's end. In this case, you are able to raise the rent in the shortest notice of 15 days. The laws in Florida regulate the rules for notice delivery, though. You need to mail or personally deliver the rent increase notice. If your tenant isn't at the property, you can post the notice at the property.

Remember that your tenants may reject the rent increase. In this case, they can remain there until the tenancy ends. The tenants just need to properly pay the current rent.

Another aspect is the rent increase that falls under discriminatory or retaliatory reasons. For example, retaliatory reasons include raising the rent because your tenant requests maintenance. Or they report any code violations. Rent isn't a tool for getting revenge.

Discriminatory practices are a serious problem. You have to make sure that you don't raise the rent for the following reasons:

  • Age
  • Color
  • Gender
  • Having underage children
  • Marital status
  • Mental or physical differences

diversity-discrimination

  • Military discharge (the unfavorable kind)
  • Sexual orientation
  • Race, ancestry, or national origin
  • Religion

Consider looking at the Fair Housing Act more thoroughly to avoid legal problems in the future.


Which improvements call for a rent increase?

Improvements on the property give a solid base for rent increase.

Appliances and services

Leasing appliances appeals to many tenants. For example, you could lease an oven, washer, or even a TV-set. Some landlords offer to include services in rent as well. These could include a landline phone and cable TV. Taking care of them as a bundle saves your tenant's time and makes their life easier.


Reconfiguration

Do you have a large unit? 

Sometimes you are able to divide your property into multiple units. You can have a mix of short-term and long-term rental units.


Upgrades/Remodeling

Fresh paint? Brand new fixtures? 

paint-walls

Improvements like these may seem basic but if the simple upgrades enhance the tenants' living experience, it's a reason to raise the rent.


How much should you raise the rent?

There are many approaches to tackling this question:

Calculations

What's the return you want to get on the rental property investment? 

How much are your annual expenses? 

It is recommended to put all the data on a spreadsheet to help you come up with answers to the previous questions. Plug-in various monthly rent options to see how these play out.


Research

Do a lot of research before setting the rent price. Browse online real estate rental sites to see prices for your property's location. It's useful to chat with the other landlords as well. Knowing the current market conditions is essential.


Start high

It's better to start high than low. You can always adjust your rent when you find out that it's too high for the market.

money-house-calculator

But it's not something you could do the other way around. If your price is too low to start with, then you won't get a chance to increase the price.


The bottom line: raising the rent on your Miami rental property

There are many reasons why you should raise the rent of your Miami rental property. Increasing expenses and investments in improvements stand for solid reasons.

Factor in the expenses and expected return. Do adequate research to ensure your rental price reflects the current market. It's always better to start high and negotiate the price down. It doesn't work the other way around.