Rent is one of the biggest expenses you likely face in your monthly budget. Subsequently, significant increases in rent can be a cause for major financial concern. In most cases, a landlord can handle rent as he likes after your original lease expires, but this isn't true in every jurisdiction.
Laws regarding rent control, which include but are not exclusive to rent increases, vary by jurisdiction. In the majority of states, there are no caps on how much a landlord may raise rent following the expiration of a lease. However, some counties and cities do have ordinances that limit how much rent can increase. A guide to the areas with such ordinances is found at Landlord.com (see Resources). If there is no ordinance that applies, the landlord can raise rent by as much as she sees fit. If there is an ordinance, the landlord cannot increase the rent higher than the regulatory limit.
In some cases, regardless of whether a rent-control ordinance is available, your lease sets a limit. Usually, to accommodate inflation and variances in the value of the dollar, these limits, like those in formal ordinances, are expressed as percentages. The limit set by the lease may be less than that permitted by any applicable ordinance, but it cannot be higher. Because leases are formal legal contracts, you have a right to fight rent increases that exceed the amount specified in the lease.
Even when your landlord can raise your rent to the ceiling, he still has to give you proper notice about the increase. In most cases, this means a minimum of 30 days, which accommodates monthly billing cycles, but some states require notice of 45 or 60 days. In areas where there are caps on rental increases, the number of days' notice required is connected to whether you are a periodic -- that is, month-to-month -- tenant and the percentage of the increase. For example, in California, landlords must give periodic tenants 30 days notice if the increase is 10 percent or less; if the increase is more than 10 percent, then month-to-month tenants must receive 60 days notice.
It's true that some landlords try to raise rent beyond a justifiable and reasonable percentage. However, good landlords usually raise rent based on the researched market value of similar properties, and on their operating and maintenance expenses. If you receive a large rent increase, it usually means that the landlord hasn't done this research for some time, or that operating and maintenance costs increased significantly. Most landlords keep an eye on their costs and on the market so they can seek small yearly increases instead of one large, less palatable increase every few years.
If you feel that your rent increase is too high, it's to your benefit to talk to the landlord cordially to see what type of information the landlord used to calculate the increase. In some instances, if you can show the landlord his information is not entirely accurate, the landlord may reconsider the increase. He also may reconsider if you present a good case for the financial hardship the increase would cause, and may try to compromise, as it's often more expensive to find a new tenant than it is to keep a current one.
- Hemera Technologies/AbleStock.com/Getty Images