Hi
I am trying to crunch the numbers on a Sydney property for sale and I'm wondering if I can just go ahead and up the rent on purchase?
Would I need to wait until the current leases expire?
Aside from market rate, is there a limit to how much I up the rent? (I want to go up by as much as 50%)
Thanks
KentonI'm almost positive you do not have to wait until the end of a lease to up the rent. At the same time I pretty sure you wont be able to get away with a 50% increase, maybe 10-20% every 6-12 months. I'm sure there would be many rulings/examples of landlords trying to do this. Once your tenant is out, charge what ever you like.
Hi,
You might want to consider checking out this site too (This ones for tenants in NSW):
http://www.tenants.org.au/factsheet/rentIncreases.html
Enjoy!Oh, may i ask also how you're crunching numbers as well – that is what forumlas you're using? i'm trying to do some number crunching as well and wondering if there's a better way!
If the tenant is under a lease there is no provision for any rent review until expiry of the lease. You will need to give 60 days notice of any rent review before it can take effect.
The lease is technically between the property and tenant, not the owner so the property changing hands does not affect the lease.
Hi, I'll like to emulate your style! How on earth do you get a tenant to absorb a 50% increase?
KYHi Vstar
I'm just using:
Annual Return/market rental yield = Property PriceSo, I believe that the rent is 33% below market rate thus the property's going for 2/3rds price …. but only if I can get the rent up
Thanks also to Jeff and Scott
KentonKenton, you may have to bite the bullet if you want someone to accept the new rent (after the lease expires). You may have to weigh up the cost of keeping a paying tenant (with a smaller increase) against losing them, having to carry out works and waiting for a tenant to occupy.
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