Real Estate

House rental raising monthly rent

  • Last Updated:
  • Feb 14th, 2022 10:14 pm
Newbie
Feb 25, 2019
23 posts
6 upvotes

House rental raising monthly rent

Not sure if this is the right place ask.

I've been renting a semi-detached townhouse to a tenant for a couple years.

For the entire house, I'm only charging $1,600/month, all the houses near the area are charging at least $2,000+ minimum.

So I'm just wondering are there any ways to increase the rent to $2,000/month? Or do I have to stick to the government guideline and only allowed to increase 1.2%?

Thanks in advance.
51 replies
Deal Fanatic
Mar 21, 2010
6737 posts
3998 upvotes
Toronto
When was it built and first occupied (not as a rental, but overall)?
Sr. Member
May 7, 2015
951 posts
1529 upvotes
Toronto, ON
You can do anything you want.

Ask them, if they agree you’re good to go.

If they don’t and you live in Ontario you can’t force them.
Member
Oct 6, 2017
407 posts
453 upvotes
Assuming you are in Ontario, you have 3 options;

1. Suck it up

2. Ask the tenant nicely and see how much increase you can get out of them if they agree to

3. If you can't accept the rent loss emotionally, sell the property, pay capital gain tax, and then buy another and charge as much as you want to begin with. Thumbs Up Sign
Member
Oct 6, 2017
407 posts
453 upvotes
I'm in the same boat as well. One of my properties is at least $300 below market rent, but I'm a new landlord so I'm just sucking it up for now and getting some experience under my belt.
Member
Mar 31, 2013
346 posts
1112 upvotes
Courtenay, BC
Try not to stress about the money too much......if they are a good tenant count your blessings......if you ever have a bad tenant you will understand where I am coming from
Deal Addict
Oct 14, 2010
1292 posts
1788 upvotes
Toronto
phantomfj wrote: Try not to stress about the money too much......if they are a good tenant count your blessings......if you ever have a bad tenant you will understand where I am coming from
Get into the game knowing the rules, and this.

If tenant is good count your blessing.
Deal Addict
Dec 3, 2013
1814 posts
3254 upvotes
Somewhere over the r…
You have to stick to the guidelines unless its exempt from rent control. To be exempt from rent control means that it was occupied for the first time for residential purposes after November 15, 2018. Unless the tenants agree to it. You can't force it

You can apply to the board to increase rent more than the maximum allowed increase if you have expenses over and above normal such as a major capital expense. Being below market rate doesn't count. This is assuming Ontario.

Always Always Always increase the rent every year to the maximum allowed.
Newbie
Dec 25, 2021
59 posts
98 upvotes
Assuming Ontario? And that the home was 1st occupied by anyone before Nov. 2018? You cannot raise their rent more than 1.2%. If you want to do this, you need to issue them an N1 Form and give them at least 3 months notice. Are they good tenants? If so you need to ask yourself if increasing rent by $19.20 a month is worth any chance they are upset. If it's that under market, it shouldn't be an issue, but yup 1.2% is all you can raise it.
Deal Guru
User avatar
Oct 16, 2008
11338 posts
5531 upvotes
Vaughan
phantomfj wrote: Try not to stress about the money too much......if they are a good tenant count your blessings......if you ever have a bad tenant you will understand where I am coming from
^^^ this ^^^

Good tenant worth much more than $$$.
...
Deal Addict
Dec 3, 2013
1814 posts
3254 upvotes
Somewhere over the r…
fmrrecoemployee wrote: Are they good tenants? If so you need to ask yourself if increasing rent by $19.20 a month is worth any chance they are upset.
I see this statement all the time and just think it's silly. In over 20 years I've only had a tenant say something about a rent increase once and it was along the lines of "I'll have to consider moving" which she never did. Every unit I have gets a rent increase to the maximum allowed every year regardless if a tenant is good bad or otherwise. It's a 1.2% increase. No one is going to go thru the hassle and expense of moving for $19.20 a month. It would be different if it were $300 a month.

Prices increase every year everywhere on everything. Rent is no different
Banned
Mar 3, 2021
707 posts
360 upvotes
...and how is your mortgage payment on the said house increasing every year? Cut the crap and put greed aside. It's true that a good tenant is worth more than an empty house with no rent. Karma is a biatch. You can lose a good tenant and end up with one that will default, and you having to go through the stress of trying to evict.

Just because everyone else on the street is raising their rates, doesn't mean you have to!
Worriedone wrote: I see this statement all the time and just think it's silly. In over 20 years I've only had a tenant say something about a rent increase once and it was along the lines of "I'll have to consider moving" which she never did. Every unit I have gets a rent increase to the maximum allowed every year regardless if a tenant is good bad or otherwise. It's a 1.2% increase. No one is going to go thru the hassle and expense of moving for $19.20 a month. It would be different if it were $300 a month.

Prices increase every year everywhere on everything. Rent is no different
Deal Addict
Dec 3, 2013
1814 posts
3254 upvotes
Somewhere over the r…
sffpcgtx wrote: ...and how is your mortgage payment on the said house increasing every year? Cut the crap and put greed aside. It's true that a good tenant is worth more than an empty house with no rent. Karma is a biatch. You can lose a good tenant and end up with one that will default, and you having to go through the stress of trying to evict.

Just because everyone else on the street is raising their rates, doesn't mean you have to!
I never said a good tenant wasn't worth more than an empty house. Please elaborate where I said that, I'd love for you to point that out. No one is going to lose any tenant for $20/month increase in rent.

All I said was the statement is silly because realistically no one is going to move for a $20 month increase in rent. It's an empty threat. There are so many factors outside of the rent payment that makes it a huge negative to do so, Kids schools, proximity to work or family and the cost, stress time and headache of moving to mention a few. Obviously there is a price point where it will make a tenant move or consider moving, but $20 isn't that price point.

As far as my mortgage payments. They are the same as they have always been for those that still have a mortgage But since you asked, my property taxes, utilities, cost of repairs/maintence, Fees like credit checks, bank service fees and the many other fees/expenses that go into owning and properly maintaining a property and the appliances within have greatly outpaced the 1.2% allowed as an increase for the past 2 years.

You obviously have an axe to grind, and feel free to grind away, I could care less. I've been a great landlord for over 20 years, maintain my properties well and have more than a few rental properties. I'm not to worried about Karma for raising my rates a whopping 1.2% over the past 2 years. Nor am I concerned what someone who has an axe to grind thinks about the matter. But I'm not going to lie, seeing the hatred seethe thru in posts such as yours gives me some entertainment.
Last edited by Worriedone on Feb 6th, 2022 2:57 pm, edited 2 times in total.
Newbie
Feb 25, 2019
23 posts
6 upvotes
Manatus wrote: When was it built and first occupied (not as a rental, but overall)?
Definitely before 2018
Newbie
Feb 25, 2019
23 posts
6 upvotes
phantomfj wrote: Try not to stress about the money too much......if they are a good tenant count your blessings......if you ever have a bad tenant you will understand where I am coming from
Yes, this is why they are still my tenants.

However, $2,000 was the lowest I could find in the area, majority are charging at least $2,500+, $1,600 could only get you a two bedroom basement.

So that's $800/month or almost $10k a year additional income, and it's not like I'm being greedy.

I'm just trying to adjust it to the market rate, and $2,000 is still below it.
Newbie
Feb 25, 2019
23 posts
6 upvotes
budwizestest wrote: Get into the game knowing the rules, and this.

If tenant is good count your blessing.
I'd say to a certain degree. Would you still apply this if it's $10k difference a year in rent?

$10k is only a year, what if they rent your property for another 5 years?

If you invest the $10k annually and be conservative with only 4% rate of return. 5 years would make you around $56,300 passive income.

Not to mention everything is increasing in price.

I'm not a charity nor my tenant's babysitter.
Deal Expert
Feb 29, 2008
21739 posts
21353 upvotes
Tarrana & The Ri…
DJDJDJDJDJ wrote: I'd say to a certain degree. Would you still apply this if it's $10k difference a year in rent?

$10k is only a year, what if they rent your property for another 5 years?

If you invest the $10k annually and be conservative with only 4% rate of return. 5 years would make you around $56,300 passive income.

Not to mention everything is increasing in price.

I'm not a charity nor my tenant's baby sister.
You're in Ontario.
Member
Oct 6, 2017
407 posts
453 upvotes
DJDJDJDJDJ wrote: I'd say to a certain degree. Would you still apply this if it's $10k difference a year in rent?

$10k is only a year, what if they rent your property for another 5 years?

If you invest the $10k annually and be conservative with only 4% rate of return. 5 years would make you around $56,300 passive income.

Not to mention everything is increasing in price.

I'm not a charity nor my tenant's babysitter.
I agree with you that $10K is a lot to lose. I myself am losing about $5K a year. It does hurt, but unfortunately in Ontario you don't have too many options other the 3 I mentioned in my first post above. I thought of selling my property but then I will have to pay capital gain tax. For now I just pray my tenant leaves.

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