Long Term Tenants Question

[Seymour]

Do any of you guys treat long term tenants in any special way. particularly regrading annual rent increase. By long term I mean been in the same rental of yours for over five years.

[Nick G]

I tend to increase gradually. At the same time I stay on top of maintenance. I do that for all tenants but the long term ones get fast/extra attention.

[Aston]

Do any of you guys treat long term tenants in any special way.

I will NEVER increase the rent of a tenanted property, if the tenants are reliable. However I am a landlord that chooses to be a landlord and not a landlord by default, ie. a property investor. My longest term tenant was 10 years, he would still be with me had he not died.

[Keys]

I will NEVER increase the rent of a tenanted property,

Tenant moved in to a four bedroom property in 1991. Moved out last year. Initial rent was $130 per week. Would you consider revising the word "NEVER"?

[Anthonyacat]

Keys - there are genuinely people out there who don't increase the rent. Some family friends recently moved out of their home in Papakura that they had been renting for at least 30 years, their rent when they moved in was something like $50, and they were paying $190 when they vacated.

I personally don't understand it. It's effectively targetted charity, aimed at a person you don't know is the most deserving. I'm all for charitable giving, but why not get something close to market rents from your property and donate that extra $10-15k per year to whatever cause you feel is worthy?

There's also the slightly weaker but tenant-focussed argument that you're effectively locking your tenants into a higher spending lifestyle. As landlords many of us have self-selected into a group where we save for our future, but the majority of the country will spend what they earn, and maybe a little more. Lower rent means more 'stuff' that they won't be able to support when they move and have to pay market rents.

[Aston]

I personally don't understand it. It's effectively targetted charity, aimed at a person you don't know is the most deserving. I'm all for charitable giving, but why not get something close to market rents from your property and donate that extra $10-15k per year to whatever cause you feel is worthy?

Anthonyacat I Understand your point. I just believe in holding onto a good tenant, so if it means that I'm down a few dollars at the end of the year then so be it. The bad tenants will sort themselves out, they either move on or will be moved on.

When I first became a landlord I was totally money focussed and it was all about the bottom line. I was greedy. My focus changed when I realised that I was actually a landlord and not a property investor. Tenants are real people and a good tenant is worth more than a few dollars in the bank.

[Nick G]

As landlords we look at rent as our barometer. Don't forget that for many tenants the security of tenancy is also important.

Charge market rents or a shade under if you want to, however be serious about reinvesting back into the asset. You should be doing this anyway.

Insulation, heating, ventilation (if needed), replace worn fittings etc. I know someone who bought a tenant a garden shed off TM once, it didn't cost much and the tenant went and picked it up and installed it. They stayed years.

Going forward with the Healthy Homes bill and probably a bunch of WoF "initiatives" you're going to have to spend anyway and your insurance, rates and other costs will increase.

At the same time, you could offer them a longer fixed term tenancy should they want it.

If you feel bad about it, ask your self what your tenant would do if the market rent slipped to $50pw under what you charge now.... goneski....

[srv]

We have been in our apartment in Sydney for over 5 years. The landlord keep increasing the rent every year by about $50 as the market is still pretty crazy over here.

While it's inline with market rates for the size of the property every time it gets jacked it makes us look around to see what else is out there. I do find it odd as before us it sounded like they had significant issues finding tenants who didn't trash the place.

If we were not so busy with work and other commitments we would of moved by now as we could easily live somewhere smaller / cheaper and save about $150pw.

[Beano]

Real test
Would you still have the same attitude of "keep the rent low " for a long term tenant if they were effectively "locked " in a long term lease and had invested a lot into the building?
I am asking that question as the risk of vacancy is reduced with low rentals

[SPerfect]

Do any of you guys treat long term tenants in any special way. particularly regrading annual rent increase. By long term I mean been in the same rental of yours for over five years.

I review it annually and if their rent is still within current market rents I leave it, but I do generally up the rent with new tenants knowing that it may not necessarily be raised after 1 year. I gave last new tenants a choice of a 1yr lease or 2yrs and the rent stays the same - so they opted for 2 years. Piece of mind for both of us.