Raising the rent is one of those things every landlord thinks about—but no one really wants to do. You don’t want to upset a good tenant, but at the same time, your costs are going up: rates, insurance, maintenance… maybe even your mortgage.
So how do you do it legally, fairly, and without losing a great tenant?
This article walks you through how to increase your tenants rent the smart way—without drama, without guesswork, and without breaching the Residential Tenancies Act. You’ll learn the rules (especially for New Zealand), how to time the increase, what to say, and how much you can actually raise the rent by.
Plus, there’s a ready-to-use rent increase letter template you can copy and adapt. Let’s get into it.
Can you increase your tenant’s rent?
Yes, you can—but not whenever or however you want. There are rules, and in New Zealand, they’re crystal clear under the Residential Tenancies Act.
Rent increase rules in New Zealand
If your tenant is on a periodic tenancy, you can increase the rent once every 12 months. You’ll need to give them at least 60 days’ written notice, and the increase must be fair—aligned with market rent.
For fixed-term tenancies, you can only raise the rent if the contract explicitly allows it, and even then, the same 12-month and 60-day rules apply.
When are you legally allowed to increase rent?
- No more than once every 12 months
- Only with 60+ days’ notice in writing
- Must be in line with market rent (within 10–15% of similar properties)
Want to be a landlord who does it right? Start by knowing the rules—then plan your move.
How much can you increase the rent?
You can’t just bump rent by $100 because your insurance went up. The increase needs to be reasonable and based on comparable properties in your area.
Market rent vs what your tenant pays
If your tenant is paying well below market, you can adjust—but do it gradually and with a clear explanation. Sites like NZPIF and local Property Investor Associations provide rent data by region.
Maximum frequency of rent increases
One rent increase every 12 months. Even if your expenses go up, the law doesn’t let you adjust more often.
| Rule | NZ Requirement | Notes |
|---|---|---|
| Max frequency | Once every 12 months | Applies to both periodic & fixed-term (if clause exists) |
| Notice period | 60 days (written) | Must state amount & date clearly |
| Market rent alignment | Within 10–15% of similar properties | Use local listings or NZPIF data |
| Allowed during fixed term | Only if clause is included in the tenancy agreement | Otherwise wait until renewal |
| Rent increase method | Must be in writing | Use official template (PDF) |
If you’re unsure how this fits into your broader property strategy, we’ve broken down the benefits of investing in residential property in another guide.
Best timing to increase rent
Timing matters. Even if you can raise the rent, the when can make the difference between a smooth conversation and a tenant suddenly giving notice.
Good timing windows:
- At lease renewal (when tenants expect changes)
- After repairs or upgrades to the property
- When rates, insurance, or maintenance costs have increased
- At the end of a fixed-term agreement
Avoiding rent increase mistakes
Don’t raise rent:
- In the middle of winter (harder to replace tenants)
- Mid-lease without written clause
- Without giving proper notice
- Without understanding tax implications (check this article: Selling a rental property: What’s tax deductible?)
How to tell your tenant the rent is going up
The key is communication: clear, respectful, and transparent.
Tone, transparency, and written notice
Good tenants aren’t just rent payers—they’re asset protectors. The more respect you show in your communication, the more likely they’ll stay.
What to include in your rent increase letter:
- Date of the letter
- Current rent
- New rent
- Date the new rent starts
- Reason for increase (optional but appreciated)
- Your contact details
Template: rent increase notice example
Here’s a simple template you can copy, paste, and adjust:
Subject: Notice of Rent Increase
Hi [Tenant Name],
We hope you’re doing well. We’re writing to let you know that as part of our annual rent review, the weekly rent for [Property Address] will increase from $X/week to $Y/week, effective [Date – at least 60 days from today].
This change reflects market rent levels for similar homes in the area and increased maintenance and property costs.
All other terms of your tenancy remain unchanged. If you have any questions, feel free to reach out.
Kind regards,
[Your Name / Property Manager Name]
[Contact details]
If you’re managing multiple properties, set a reminder to review rents annually and standardise this process.
Alternatively, you can find a template to download here: Rent Increase Notice (PDF, Tenancy Services)
Bonus tips for managing rent reviews
- Set a recurring calendar reminder for rent reviews (once per year per property)
- Keep a record of comparable properties to justify your increase
- Offer small upgrades to justify the increase (e.g. new heat pump, fresh paint)
- Weigh up long-term tenants vs short-term gains
- Keep receipts and documentation for deductible expenses
Need help running the numbers on your rental property?
We do this every day at BH Accounting. We’ll help you figure out what’s fair, legal, and smart for your long-term investment.
Want to increase the rent without losing a good tenant?
Raising the rent doesn’t have to be awkward—or risky. When done right, it’s just part of smart property management.
Whether you need help reviewing market rents, planning upgrades to justify a higher rate, or making sure your rental income keeps up with inflation, we’re here to help.
Contact BH Accounting for a personalised review of your rental property strategy.
We’ll help you stay compliant, stay profitable, and stay ahead of the game—without stressing your tenants or breaching the rules.
FAQ about how to increase your tenants rent
How much notice do I have to give in NZ?
You must give at least 60 days’ written notice before the rent increase takes effect. The notice must be in writing and clearly state the new amount and date.
Can I raise rent during a fixed-term lease?
Only if there’s a clause in the agreement that allows it. Otherwise, you have to wait until the lease ends.
Do I need a reason to raise the rent?
Legally, no—but it helps maintain trust. Reasons like increased rates, market rent adjustments, or property improvements are valid.
What if the tenant refuses the increase?
If you’ve followed the law and given proper notice, the increase stands. If the tenant wants to move out, they must follow the normal process of giving notice.
How do I find out what market rent is in my area?
Use rental listings, talk to a local property manager, or check data from the NZ Property Investors Federation or your local council.