Inflation Rent Increases

Grow Property Management owner Joe White answers the question on how much should a property owner landlord increase the rents because of inflation.

Read full transcript here:

this question is from Terry Terry asked

how much are you racing your rent

because of inflation


that's not really the way it works so we

charge as property management company in

a pretty efficient property management

company uh we charge what the market

well there so the we charge as much rent

as a tenant is going to pay within a

reasonable amount of time vacancy gets

extremely expensive so we don't want the

property sitting vacant because it's

costing the property owners a fortune

and thousands of dollars a month in rent

but we basically

put the property on on within asking

price and we very religiously uh check

the metrics on it so we want to see what

kind of traffic we're getting we need to

get X number of inquiries a day uh and X

number of those inquiries uh that folks

who actually asked to see the property

and at that point we know the property

is likely Priced Right and

will rent within a reasonable amount of

time so what we're not basing it on

would be things such as inflation or our

expenses and it's kind of a common

question owners will ask us well tell us

what their mortgage payment is and

that's just not something that comes

into the equation so your expenses as a

property owner

or not something that actually uh

really matters uh relative to what a

tennis is going to play for your

property whether they're going to pay

more or less so if you have a very

expensive air conditioning repair that

costs you seven thousand dollars if your

mortgage payment somehow went up uh

whatever it would be your expenses do

not matter to a tenant that's looking

for a place to live so we charge the

absolute most money that we can get from

a tenant and that is uh not relating to

any outside factors

um now I mean as far as inflation goes I


rents do tend to go up and and up Market

when the real estate is doing well and

unfortunately for tenants rents tend to

go up in a down Market as well so 10

rents generally speaking rarely ever go

down now as far as inflation affecting

you the landlord the property owner and

things are getting more expensive for

you and thus they should be getting more

expensive at the tenant well if you have

any debt on the property you actually

are kind of hitting the jackpot so uh

inflation is an Investor's best friend

so yes when I go and get gas yes when I

go and buy things uh that help me have a

rental property much more expensive but

all the debt that I have on the property

is actually getting devalued so you are

getting that benefit so even if you're

getting a hit with inflation and things

are more expensive at owning a rental

property you can take comfort in the

fact that you're actually just making a

huge huge killing just with any debt

that you know I have so every dollar you

owe this time next year because of

inflation is devaluating so you're

actually getting a massive return right

now I mean if inflation is going to hit

around eight percent you're giving it

eight percent additional return on your

on your money so uh so yeah we can't

really so what you should be sure right

on is how much you rent you can get uh

you know from a tenant and that's how

much you should rent your your rent time

all right good luck


Joe White

Joe White is a Philadelphia Property Manager and Real Estate Broker. He is the owner of Grow Property Management and has been involved in the management, sales and purchases of Philadelphia area rental investment properties since 2008. He is an author and works as a real estate investment consultant and construction manager.

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