Rent Calculator - How To Use
What is this tool?
This tool was designed to help aid in the decision of how much you would like to increase rent. This was designed with residential rent in mind, but could be used for commercial as well.
Looking for where to get this spreadsheet? See our Free Tools page or click here!
https://www.goldenhivebookkeeping.com/free-tools
Basic Data
The essential data you will want to fill out can be found under the Rate Calculation tab. You will want to adjust the Current Rate, Risk Tolerance, and Market Rate to match the data relevant to your property.
Current Rate
The rate you are currently charging your tenants.
Risk Tolerance
How much you’re willing to risk your tenants moving out or not being able to fill the unit due to increased pricing.
Market Rate
The current market rate in the area. If you do not want this to be included in the calculation, simply enter 0 for the market rate.
Output
Once you’ve filled out those three fields, the spreadsheet will calculate a new rate based on that data. Do not edit the fields under New Rate as it will cause the spreadsheet to no longer calculate based on the data you enter.
New Rate
The new rate being suggested based on the data that was provided.
Percent Increase
The amount that the new rate is higher than the current rate as a percentage.
Dollar Increase
The amount that the new rate is higher than the current rate as a dollar value.
Calculations Tab
The Calculations tab is where the data you’ve provided is compiled to create the percentage increase. You may edit this tab to adjust how the math is calculated to have it more in line with your preferences. Editing this tab is only recommended if you are familiar and comfortable with the use of spreadsheets.
Yellow Cells
The yellow highlighted cells are entered data and do not include a formula. These would be easy to adjust to meet your needs.
Rate
The Rate column is the rate increase as related to the selected risk. The default data has 1-5% based on general market research on rent increases. If you found this to be too conservative or not conservative enough, then you may adjust these percentages to be more in line with your opinion on relevant % increases based on risk tolerance.
Market Rate Adj
The Market Rate Adj column defines how much the difference in market rate from the current rate will affect the price increase. This value is multiplied by the difference value in H4 to get a new market %. If the market rate is lower than the current rate then the market rate will not be taken into account.
Red Cells
The red highlighted cells are formulas used to aid in the calculation of a new percent increase. It is recommended that you do not edit these. If you would like to adjust them, ensure that you understand the formulas before making any adjustments.
New Market %
The Market Rate Adj multiplied by the difference of the current rate and market rate to get a new percentage that takes the risk value into account.
Total % Increase
The Rate % and the New Market % added together to create the total increase %.
Market rate to current
The market rate divided by the current rate and displayed as a percentage.
Is >100%?
Evaluating if the market rate to current cell is over 100%. Displayed as true or false.
Difference
The market rate to current - 1 to show the percentage increase.
Other Notes
This document assumes that you would like to increase rent and does not currently account for the lowest risk option of not increasing rent.
This document is meant to aid in your decision making but is not providing a “correct” decision or a fool proof way to ensure you increase rent as much as possible without losing your tenants. This tool is more so intended to be used to make it simple to compare options and remove some of the uncertainty associated with starting with a blank slate.
Looking for more help?
Are you looking for more assistance with your bookkeeping? We can help! Here are a couple of different ways we may be able to help you.
Add to or adjust the spreadsheet to better fit your needs
Fix issues from adjustments or accidentally deleting something
Provide one on one training on how to use the spreadsheet
Assist with creating tangent spreadsheets
Free up your time by providing virtual bookkeeping services
Review your data and provide consulting advice
If you’re looking for any service not listed here it doesn’t hurt to reach out and see if it’s something we can help with!
As thanks for using our tool, we’re happy to provide a free 15 minute minute session to help with any of these issues. To get in contact, feel free to fill out our form or email us at Spreadsheets@goldenhivebookkeeing.com.