Renting out your Fort Collins property can be a lucrative investment. But in order to maintain your yields, you’ll probably need to raise rent every once in a while.
That’s why landlords need to be aware of the local rent increase laws in their state or city. In this article, we’ll explore the sometimes-complicated but all-important world of rent increase laws in Fort Collins, Colorado.
Let’s dive in!
How Much Can You Increase Rent?
When it comes to increasing rent in Fort Collins, Colorado, there are no specific laws that dictate how much you can raise the rent. However, it's crucial to strike a balance between maximizing your rental income and ensuring resident satisfaction. Raising the rent too frequently or by a significant amount can lead to resident dissatisfaction and potential legal issues.
Landlords cannot increase rent more than once in 12 months to give residents ample notice and time to adjust their budgets accordingly
One factor to consider when determining how much to increase rent is whether you have made significant improvements or renovations to the rental unit, in which case it may be justifiable to raise the rent slightly higher than the average market rate. That’s because residents are often willing to pay a higher price for a well-maintained and updated property.
Another important consideration is the current rental market conditions. If the demand for rental properties in Fort Collins is high and the supply is low, you may have more flexibility in increasing the rent. On the other hand, if the market is saturated with available rentals, it may be wise to keep the rent increase minimal to attract and retain residents.
In conclusion, it's important to consider these factors, including resident satisfaction. By conducting thorough research and making informed decisions, you can ensure a fair and reasonable rent increase that benefits both you as a landlord and your residents.
When Can You Increase Rent?
As a landlord in Fort Collins, you have the right to increase the rent when a lease is up for renewal, so you cannot raise the rent in the middle of a lease term unless it is allowed for in the lease agreement. It's important to include a clear clause in the lease agreement that outlines the possibility of rent increases during the tenancy.
Furthermore, if you are on a month-to-month lease agreement, you can increase the rent by giving the resident proper notice. This notice typically ranges from 30 to 60 days, depending on the lease terms and local ordinances. It's important to check with the local housing authorities to determine the specific notice period required by your property in Fort Collins.
Additionally, consider the timing of the rent increase. While it is generally allowed at lease renewal or with proper notice on a month-to-month agreement, it's important to be mindful of the resident's financial situation. Raising the rent during times of economic hardship or when the resident is facing financial difficulties may not be well-received and could potentially lead to vacancy or resident dissatisfaction.
Lastly, keep in mind that rent increases should be reasonable and in line with market rates. It's important to strike a balance between maximizing rental income and maintaining a positive and mutually beneficial relationship with your residents. Moreover, open and transparent communication can also help maintain a positive landlord-resident relationship and minimize any potential conflicts.
How Do You Increase Rent?
When you decide to increase the rent, it's crucial to follow the proper procedures:
Evaluate the local rental market and determine a reasonable rent increase based on comparable properties.
Review the lease agreement to determine if there are any provisions that allow for rent increases during the lease term.
If the lease is up for renewal, send a renewal notice to the resident with the new rental amount and any changes to the lease terms.
If the resident is on a month-to-month lease, provide written notice of the rent increase within the required timeframe specified by local laws.
Document the rent increase in writing and keep a copy for your records.
Note: A Fort Collins property management company can help with all of the above.
By following these steps, you can ensure that you are increasing rent legally and fairly.
Giving Notice of Rent Increase
When giving notice of a rent increase to your residents, it's essential to do so in writing, which provides a clear record of the increase but also ensures that both parties are aware of the new rent amount. Here are a few key points to consider when giving notice:
Provide the resident with written notice that includes the effective date of the rent increase, the new rental amount, and any changes to the lease terms.
Deliver the notice in person or through certified mail to ensure proof of delivery.
Keep a copy of the notice and any related correspondence.
By providing written notice, you can avoid any potential disputes or misunderstandings regarding the rent increase.
Final Thoughts: Rent Increase Laws in Fort Collins, Colorado
Renting out properties in Fort Collins, Colorado, can be a lucrative investment, but it's important to understand and follow any existing rent increase laws in Fort Collins. When increasing rent, do your research, assess market rates, and be careful not to increase rent too frequently or significantly. Remember to provide proper notice and keep written documentation of all rent increase notices.
By following the guidelines outlined in this article, you can navigate the rent increase process smoothly and ensure compliance with Fort Collins' regulations. Happy renting!
Looking for a professional property management company to help with setting and raising rents? Contact our Fort Collins team today!
