How Can You Benefit From A Tenant Renewing Their Lease
Every landlord wishes for their tenants to stay. No landlord is fond of looking for new tenants every year. Most landlords try to maintain good terms with their tenants in the hope that the tenants will request the landlord for a lease renewal. There are numerous ways in which a landlord can benefit from a tenant renewing their lease. Let’s have a look at them below.
1.No Hassle of Finding New Tenants
Finding new tenants for your property is not an easy job. Every time you’ve to look for new tenants, you’ve to run extensive background checks to ensure they’re the right people to hand your property over to. Even before you find a suitable tenant, you’ve to post new ads, show around your property to potential tenants, work on new lease agreements, and form a bond with the new tenants from scratch. Finding new tenants for your property does not just sound too much work but is truly time consuming and hectic.
2.Saves Vacancy Costs
The process of finding new tenants isn’t just tiresome but costs a pretty decent amount too. Having a vacant property is associated with marketing costs and holding costs. Holding costs can leave a significant impact on you as a homeowner. It means you lose the rent for every month for which your property stays vacant, and you still have to pay your property taxes, utility bills, and mortgage despite the fact your property is vacant. Marketing costs include the cost that goes into getting your ads printed in hardcopy and publishing ads online. You might also have to hire a property management company to help you find a suitable tenant for your property.
If your existing tenant renews their lease, you can save all these costs!
3.Avoid Property Turnover
Every time you’ve to look for new tenants, you’ve to ensure that your property is in an immaculate condition. Property turnover involves cleaning your property top to bottom, re-staining the hardwood floor, a fresh painting coat in the entire house, replacing broken tiles, fixing of any holes in the walls, and a complete renovation of the unit to make it look its best. It can all cost you a hefty amount of money and may take a lot of time.
However, if your tenant renews their lease, all you’ve to do is routine touch-ups and maintenance work. You won’t have to spend money on a complete overhaul of your property.
4.You Can Increase the Rent
According to the law, you can’t increase the monthly rent during the lease period. If a tenant asks for renewing their lease, you can always increase your monthly rent at that point. Every state has a law governing the percentage increase in monthly rent that is allowed. You’re required to send your tenant a notice 30 to 60 days before their lease ends and ask them if they want to get their lease renewed. In case the tenant replies in positive, you can get the new contract prepared with updated monthly rent. This way, you can get a higher monthly rent without having to go through the hassle of finding a new tenant.
5.Current Tenant Understands the Rules
Your current tenants are already aware of how you want things to be. They’ll have a great understanding of the rules and policies. Every time you have new tenants, you’ve to explain all the rules and policies and give them enough time to get acquainted with them. However, if your tenant renews their lease, you don’t have to worry about having to explain the new tenant any of your rules.
You get to reap numerous benefits your tenants renew their lease, from saving vacancy costs to property turnover costs to higher monthly rent. No wonder why every landlord wants their existing tenants to renew their lease!