As we all know, inflation is a real phenomenon that constantly puts a dent in the finances of individuals and businesses. How does inflation impact residential property owners? First, housing prices grow and so does home appreciation. This may seem like good news to someone who bought a home at a fixed rate years ago. Except when you look at the price of managing a single-family home, you’ll find maintenance costs have appreciated as well. These expenses also impact residential property investors and retirees with home rentals in the North Texas region. And the answer to covering expenses for property owners might be to “just raise the rent.” But this is more complicated than it sounds. Additionally, mistakes can incur more significant costs in the long run if rent increases are not thoughtful.
If the owner of a rental home in North Texas decides to DIY their rental increases, there are several things to pay attention to:
Rent Increases: Understand the Texas regulations around rent increases and visit the Texas State Law Library. Every state has different rules. In Texas, the general rule is that landlords can increase rents during a lease renewal, and there isn’t a general limit. However, beware that some Texas cities have rent control ordinances. The tenant also has the legal right to negotiate the proposed rent increase.
Market Rates: know the current rental price for your property. If you misjudge the reasonable going rate for your rental, it can hinder your ability to secure the right tenant.
Tenant Communication: Consider how raising the rent will impact your relationship with a good tenant. Securing great long-term tenants has value, too. If they are surprised by a significant rent increase, they might say “adios” and find another place. If you want to keep them, consider their side and approach it in a rise fair and predictable manner.
Choosing a Rental Property Management Expert Can Help Prevent Rental Increase Mistakes
If you plan to raise the rent for your tenants and are also ready to hand over landlord duties, a local management team can make a significant difference. For example, our NTXPM firm is locally established and managed. We are familiar with the North Texas rental market and know how to leverage it to the advantage of property investors. This includes how to pinpoint the right rent to secure and maintain the best tenants in the area.
Investing in rental homes in North Texas remains a sound financial decision. And there is room to grow! But not every investor or retiree wants the burden of managing property and working with tenants. We’ve made property management our career and love it! There is nothing more satisfying than watching our clients see their homes increase in value. We also care about the needs of tenants who want to live in beautiful North Texas towns like McKinney, Allen or Mansfield.
Our NTXPM team is ready to speak to residential property investors who would like someone else to handle their rental property management and calculate the best rental price points.