The housing crisis has prevented families across the United States from getting a place they can call their own. And nowhere is this problem more apparent than in Utah.
That's why every Utahn's best friend is a lease renewal. It means they have at least another year of secure housing and won't have to move back in with their in-laws. That said, even when renewing a lease with great tenants, there is a protocol you must follow.
As a landlord, finding tenants is a headache, so you want to keep the good ones. Here is how to properly deal with a lease renewal.
Carefully Evaluate Every Tenant for Lease Renewal
A lease renewal is something your only offer to great tenants. These are the tenants that pay their rent on time, obey all of your rules, and are good neighbors. If a tenant does not meet these criteria, it may not be a good idea to extend their lease for another 12 months.
Carefully Consider Any Rent Increases
Inflation has been as high as 8.5% in recent years, and landlords have to eat somehow. That said, you should be very judicious with any rent hikes. Remember, your tenants are also struggling financially.
Most tenants expect rent to increase at least a little bit. But if you have a sharp, drastic rent increase, that could be a rude awakening for them. As a result, they may decide instead to rent elsewhere.
Be Upfront about Any Changes You Intend to Make
Rental leases benefit from occasional changes from year to year. You may decide that you want to be more lax on certain rules. For example, you may want to include more amenities to reward good tenants and entice them to stay.
Of course, there may be some changes your tenants are not a fan of. Be clear about what these changes are to avoid any misunderstandings--or reconsider them.
Offer the Lease Renewal on Time
You should provide your tenant with the lease renewal at least 90 days before their lease expires. This gives them time to decide whether or not to accept. You can send this offer in the mail or over email, but it should be an official document.
Make sure to include all pertinent information here. Include any new terms, the rent you plan to charge, and so on. Openness and clarity is key, particularly if anything has changed from the previous year's lease.
Manage All Your Properties With Wolfnest
Lease renewal is a way for landlords to keep great tenants and a godsend for the tenants themselves. If you do plan on having a lease renewal, regardless of the types of leases that they are, keep the above in mind. What matters most is being honest and open to avoid any misunderstandings.
Wolfnest helps Salt Lake City property owners keep their rentals in check. Visit our website and see how we can best assist you with your rental property.