Will My Rent Go Up After Renovations? What Renters Should Know About Construction Costs and Lease Renewals
As renters, we tend to focus on the monthly rent and amenities in our buildings, without giving much thought to what goes on behind the scenes. However, one of the most significant factors that can affect your rent and lease terms is construction costs. Your building might be undergoing renovations or your landlord could be planning upgrades, and these expenses can directly impact you, especially when your lease is up for renewal. By understanding how construction costs and lease renewals are connected, you can better prepare for negotiations and anticipate changes in your rent.
What are construction costs?
Construction costs are the expenses involved in renovating or maintaining a property, sometimes even in building new common spaces or annexes. These costs include everything from the price of materials to the wages paid to workers, fees for permits, and expenses required to comply with local building codes.
In recent years, you may have noticed news about rising costs in the construction industry. Factors such as supply chain disruptions, labor shortages, and inflation have all contributed to making construction more expensive. For property owners and managers, this means that any investment in maintaining or upgrading rental properties comes with a higher price tag than before.
What should you expect during renovations?
If your building is undergoing construction or renovation, you may experience some disruptions to your daily life. Noise from tools and machinery, dust in common areas, or limited access to certain amenities like laundry rooms, parking spaces, or elevators are all common during such projects. Sometimes, construction can even affect your move-in or move-out procedures.
Your landlord is typically required to notify you in advance of any major work that will affect your living conditions. Responsible property managers will keep you informed and do their best to minimize disruptions, but it’s important for you to know your rights if the construction significantly impacts your quality of life.
Why would construction costs affect you as a renter?
When landlords face increased construction costs, these expenses often find their way into your rent. For instance, if your building is undergoing a major renovation (maybe the roof is being replaced, the plumbing system is being upgraded, or energy-efficient windows are being installed), your landlord may look to recover some of those costs by raising rents when leases come up for renewal.
You might notice your rent increasing after your building has received significant upgrades, such as a newly renovated lobby or improved security systems, or maybe you are a more direct beneficiary and you get new appliances in your unit. Sometimes, landlords are required to make repairs to comply with updated safety codes, and these mandatory improvements can also lead to higher rents. However, some improvements, such as energy-efficient appliances or an upgraded plumbing system, can lead to lower overall utility bills, meaning there will be a counter-balance to the rent increase.
Even cosmetic improvements that make the property more attractive can be used as justification for a rent increase. As a renter, it’s important to recognize that these changes can have a direct impact on what you pay each month, sometimes resulting in a significant increase when it’s time to renew your lease.
What changes during a lease renewal and why?
A lease renewal is your opportunity, as well as your landlord’s, to revisit the terms of your rental agreement. It’s common for landlords to propose rent increases at this time, particularly if they have invested in property improvements or if the rental market has shifted. Construction and maintenance costs are frequently cited as reasons for these adjustments. If you know the building has undergone renovations, go in prepared for this and with a clear idea of how much you are benefiting from the upgrades, and how much more you are willing to pay for that.
How can you negotiate your lease renewal?
When your lease is up for renewal and your landlord proposes a rent increase, don’t hesitate to ask questions. You have the right to request a breakdown of why your rent is going up, especially if construction or renovations are being used as justification. Before you accept any new terms, do your homework by checking comparable rents in your area to see if the proposed increase aligns with current market trends.
If you’re facing a rent hike due to renovations, ask if you will directly benefit from these improvements. If construction has been particularly disruptive, consider requesting a rent discount or other compensation.
Legal protections and tenant rights
Most cities and states have laws designed to protect renters from excessive rent increases or unsafe living conditions during construction. Landlords are generally required to provide advance notice—often 30 to 60 days—before raising your rent or starting major renovations that will affect your unit. If you believe a rent increase is unfair or that construction is making your apartment unlivable, you have options. You can contact your local tenant’s association or housing authority for guidance, review your lease for clauses about renovations and rent adjustments, and seek legal advice if you feel your rights are being violated. Knowing your legal protections is essential to ensuring you’re not taken advantage of during periods of construction or lease renewal.
Conclusion
Renovations are generally a good sign that the property management is invested in keeping the property up to standards, and although construction can be disruptive, there are benefits to consider. If you feel like you won’t see an increase in your quality of life as a renter in the unit, make sure you voice your concern during the lease renewal. Yet, make sure you are realistic and also understand that there might be improvements worth the extra cost. It’s all about understanding your individual situation and knowing how to navigate these discussions with respect and calm.
