Sometimes a long term tenant that has steady rent increases over years is not the best option.
Rent increases while a tenant is living in the property are usually based on a comparative market analysis of similar properties otherwise they could be challenged at a tribunal by the tenant and the price increase overruled.
When tenants leave however, rents can be tested at the higher end of the market or pushed beyond that depending on how much time is available. Ie if a tenant has communicated that they will be leaving 2 months prior, that is plenty of time to market the property and push for a higher rent with new tenants.
Overall, because the increases are steeper, a turnover of tenants can sometimes result in much higher rents achieved for the property and therefore a new precedence set for that type of property.
Agree or not?
Keep in mind that although there is a high turnover of tenants, ie once a year, the vacancy periods should still be close to ZERO if marketed effectively and early enough.
Rent increases while a tenant is living in the property are usually based on a comparative market analysis of similar properties otherwise they could be challenged at a tribunal by the tenant and the price increase overruled.
When tenants leave however, rents can be tested at the higher end of the market or pushed beyond that depending on how much time is available. Ie if a tenant has communicated that they will be leaving 2 months prior, that is plenty of time to market the property and push for a higher rent with new tenants.
Overall, because the increases are steeper, a turnover of tenants can sometimes result in much higher rents achieved for the property and therefore a new precedence set for that type of property.
Agree or not?
Keep in mind that although there is a high turnover of tenants, ie once a year, the vacancy periods should still be close to ZERO if marketed effectively and early enough.