Received letter from tenants protesting rent raise


#1

I am raising the rents at my park starting August 1st and sent out a notice for this about 3 weeks ago. I just received a letter signed by about 18 of my tenants basically reminding me that a high proportion of the park is elderly/living on a fixed income and asking me to forgo the rent raise.

I want to be 100% clear that the rent raise is going to happen. These tenants were spoiled when the previous owner didn’t raise rents for 10+ years and they were paying rents $80-90 below market. My raise in August will bring the park to just below market. The raise is $30.00 a month.

My first inclination is to just ignore the letter and anyone who doesn’t pay the increased amount next month gets a 7 day notice letter. But I would like to handle this in the most efficient manner as I can and I was wondering how other owners would handle this. Thank you.


#2

If you want to be efficient I suggest you just ignore the letter. Or, respond to the 18 tenants and tell them that your rent raise isn’t unreasonable since there hasn’t been a rent increase in 10 years. You may want to share what the rents are at other parks that are near you. They will find a way to pay the extra $1 a day even though they are on a fixed income.


#3

If it was my park I would respond, generally hitting upon several points:
-Acknowledging that many residents are on fixed income and changing rent can be difficult
-The decision to change rent is taken very seriously and isn’t done haphazardly
-The cost of operating the park increases over time
-Rent raises keeping pace with inflation are necessary to continue to provide good service and maintenance
-The cost of groceries isn’t the same as it was 10 years ago, and neither are the expenses for operating a park
-I may or may not include comps showing that the price is competitive

It won’t change everyone’s mind, but I consider attempting good diplomacy to be good business. Good luck


#4

@Noel_S

I appreciate the response. I’m leaning towards responding with something similar to what you wrote. Thank you.


#5

I would respond to letter with basically the same rent increase letter you sent them but this time explain the key points stated by @Noel_S . That’s what I have done in the past from the start. I WOULD NOT show up at the park and explain myself for obvious reasons but even the best business owners sometimes have a sore spot in their heart and we back down. If they do not pay the new rent definitely send out the required notices and move on them and it will show the rest that you are serious.


#6

Good input, I would put in comparables for the area and show them that they are still getting a deal, if what you’re saying is true about $80-90 below others. Also include apartments and housing to reinforce the low cost of living in a MHC. May want to add in the costs to move their MH to dissuade that too.


#7

@Jddorsey

The park was 80-90 below other last year. This is my second rent raise for the park and once complete it will bring the park to about 5 dollars below market. I considered adding the specific comp data but in the end I just said in the letter I just wrote that I encourage them to call other parks in the area to confirm their pricing. I also mentioned the cost to move a home. I would be very surprised if I lose a single person.


#8

I agree with outlining your reasons but not reminding them of the cost to move a home. To me that feels similar to saying “I’m raising them because I can and I bet you can’t afford to move, therefore I have the upper hand.” Am I reading too deep into it?


#9

I am not sure I would address the letter specifically on its content as a protest. I might just send a reminder notice that the rents are increasing to X dollars on this date. If you followed the laws regarding the rent increase, gave the proper notice etc., it is what it is.


#10

@Sterling

Perhaps you are reading too much into it. Either way the letter is sent. I definitely get what you’re saying and some of them certainly might read it that way and leave. I can live with that.


#11

Hmmm…must be time for a new car


#12

Hoping to not sound too self serving, sometimes it is more palatable to " In lieu of an annual rental increase residents are now responsible for their (own) fair share of the water and sewer costs "

Were here to answer your sub-metering questions


#13

@DanHelton

I did a cost benefit analysis on this and the rent raise is going to be more profitable. Water is super cheap in Alabama and the meters wouldn’t be the best choice right now. Under different circumstances I would definitely go the water meter route.


#14

Just saw this post, remember, rent raises are part and parcel to having a new park, you do your due diligence, you want it to be an income producing property. Ignore the letter (hope you did) and increase the rent.
It is a business, not a charity. Not trying to be rude here, but if they can’t afford it, they can move, no big deal. That made me sound like an a-hole, and I didn’t mean it that way.
The tenants were trying to play you. Those same people trying to play the poor card / fixed income card still have money for habits, they can find money for rent. Again, sounding like an a-hole but it is a business.


#15

@BarbraM

Definitely agree about not caving in, and I didn’t. No one moved out and every single person paid the increased amount. They can complain all they want but at the end of the day they know they have a good deal going on. My park is 100% full and I have a wait list to move in, if anything I could raise it another $20 and still do fine.

I did tell them however that next years rent raise won’t be as dramatic, mainly because the park is already near market rents. I do think it’s funny that some of them questioned my methodology when it came to figuring out what “market rents” are. One tenant reminded me not to include the rents of single family homes in the area…


#16

I love it - Make those dollars Dominic. :slight_smile: