Raising Rent during a Rent Credit Lease

If I enter into a 6 year rent credit program with a tenant, may I raise the home rent during those years, or does the home rent have to stay at the year 1 rent?

It all depends 100% on what your lease allows. A rent/credit agreement is just a rental, and your lease either allows for increases at periodic intervals or it does not.

If the rental agreement does allow increases, for example at each annual anniversary, then you can either elect to increase the rent or not. That would be a function of several pieces of information:

  1. How your current rental rate compares to the competition (including apartments).

  2. How much vacancy you currently have and if you want to run the risk of having one more vacant unit.

  3. The impact Covid has had on your market and any related laws regarding rent increases in your state.

  4. How much work this unit would need in remodeling if the occupant were to leave and you had to get it ready for a new resident.

Since you are probably considering a small increase (maybe $20 or so) you have to ask yourself if an extra $240 per year is worth the potential cost of $2,000 in renovations if they leave due to that increase.

In the end, it’s a judgement call based on the best information at hand.