When and How Much Can A Landlord Raise the Rent?

HomeLawsUSAWhen and How Much Can A Landlord Raise the Rent?

Landlords are free to the raise the rent on month-to-month tenants, but they cannot raise the rent in the middle of a long-term lease. Additionally, many states include rules about how much advance notice a landlord must give before raising the rent and, especially in major cities, the maximum amount a landlord can raise the rent each year.

No Lease or Month-to-Month

If there is no lease, the tenant is month-to-month, or a long-term lease is expiring, the landlord is generally free to raise the rent. However, rent control and other local laws may prohibit the landlord from raising the rent or may limit the amount they can raise the rent.

Raising the Rent in Middle of a Long-Term Lease

Landlords cannot raise rent until a long-term lease is completed. For example, if a tenant signs a one-year lease, the landlord agreed to charge them a certain rent for that one year. Once that year is finished, the landlord may sign a new lease with them with a new, higher rent. In other words, the lease must be expiring or up for renewal for a landlord to raise the rent.

Change in Ownership

New landlords or building owners must respect the terms of existing leases. The new landlord assumes the contracts and obligations of the previous landlord, including any rent prices in long-term leases. The new landlord must wait until those leases expire to raise the rent on those apartments.

Proper Notice

Some states include rules about how much notice a landlord must give before raising the rent. Often the rules are something similar to, “The landlord must give a 30-day notice to the tenant before raising the rent.” Other times, these rules can be more complex. For example, in Seattle, the landlord must be given a 60-day notice if the rent is raised more than 10%, or there have been multiple raises totaling a 10% increase over a 12-month period. See state law for information about proper notice timelines.

Discrimination

Landlords are not allowed to discriminate based on race, color, national origin, religion, sex, disability and the presence of children when they raise the rent (see the Fair Housing Act)e. Thus, a landlord may be able to raise rent because a tenant asked a lot of upgrades and repairs. However, if the tenant asked for those changes because the apartment was not safe for children, then the landlord cannot raise the rent – it would be discriminatory against tenants with children. Some states protect additional classes of people and may prohibit raising the rent for single units altogether.

To protect against claims of discrimination, many landlords engage in the best practice of documenting a systematic and nondiscriminatory method for raising the rent. For example, a landlord may decide to do a $50 rent raise every year for every unit once that unit’s lease expires.

Maximum Rent Raise

Many major cities include limitations on how much rent can be raised each year. Some of the calculations can be complex. New York City offers rent stabilization programs, but limits them to certain apartments and tenants, based on rent price and income, respectively In DC, most tenants can only receive a rent increase of the increase in the Consumer Price Index (usually 1-3%) plus 2%. If the CPI increase is extremely high, this is capped at a 10% increase. See your state and local law to learn more about permissible rent increases.

By |February 22nd, 2018|USA|

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