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It’s within reason - generally I think the concern is less about the % increase and more about what the new price of the unit is compared to the market. Unfortunately, the cost to switch to a new apartment is high, and landlords know that.
Pro
Before I rented in Boston I would have been incensed, but honestly that’s not bad for this city.
5% sounds totally reasonable. That probably barely covers increases in taxes, water bill etc.
I'll never forget in '00 when our rent went from 44K annually for an old Victorian to 68K because a rental agent disguised themselves as a utility worker, apparently snapped a bunch of photos, effectively pre-sold our building as overflow to a BU frat and then took the fratboys to the landlord and said 'you could earn this much from these guys if you mark up the rent this much'. Clearly, the house broke up when the rent went that high...
2 years after that, the apartment had to be condemned (it was close enough already) and it was converted over to some very expensive new construction condos. I wonder if the sewers still overflow into the basement of those condos whenever it rains now...
Landlord here.
My rental units are a significant investment …one that I saved up to buy….spend a lot of time and effort managing….and need to produce income commensurate with my investment. That said. I also want tenants to stay….its easier for me….and I want easy self reliant tenants so I keep rents in lower end of market. Think of this when you are renting (if renting from an individual)…how would I want a tenant to behave. It will pay off.