Landlord loses $28,500 from hiking monthly rent by $200

January 23, 2024 | 03:00 pm PT
Landlord loses $28,500 from hiking monthly rent by $200
A shophouse displaying a 'for rent' sign in Hanoi, July 2020. Photo by VnExpress/Anh Tu
Overconfident that their property will always be in demand, a landlord increased the monthly rent by VND5 million (US$203.46) only to suffer a VND700 million ($28,486) loss.

I would like to share a real story from where I live. The tenant of a property, rented out at VND30 million per month, was approaching the end of their rental agreement.

The tenant wanted to renew the contract but wished to maintain the same rent, promising to further renovate the property for their business.

However, the landlord did not concur and was determined to hike the rent to VND35 million per month, believing there was high demand for the property. Consequently, the tenant chose not to renew the contract.

It has been over two years and the landlord has not found any new tenants. In these two years, they have incurred a loss of more than VND700 million, all because they insisted on a VND5 million per month increase. I wonder when they will be able to recover this amount.

Reader Tran Hoang

These are comments by other readers about the story shared by Tran Hoang:

Reader José_Mourinho:

"My friend rented a whole house for VND75 million a month and ran a business for nearly three years. Later, the landlord demanded a VND90 million per month rent. With his business in difficulty, even paying VND75 million monthly was exhausting. My friend asked the landlord to either keep the rent the same or reduce it to VND70 million or he will not renew the lease.

The landlord thought my friend, having invested heavily in decorating the place, would not dare to leave and was adamant about the rent increase. Contrary to the landlord's expectations, my friend left.

A 'for rent' sign with a price of VND50 million per month has been hanging at the property for nearly two years but no one has rented it.

It might be an overstatement to say that greed leads to loss, but landlords should understand the difficult economic conditions and consider reducing the burden on tenants. After all, only when the tenants earn income can the landlords get the rent."

Reader Dan:

"Demanding higher rent during tough times and leaving the property vacant for a few months mean losing a significant amount of money. Even if a new tenant is found, it is not guaranteed they would pay the same price.

I own several rental properties and I always maintain fair and stable prices. If my tenants prosper in their business, I earn a steady income. It is a win-win situation where both sides are happy."

Reader tristan:

"Before the COVID-19 pandemic, my property was rented for VND150 million per month. As the pandemic worsened, I reduced the rent to VND120 million but still could not find a tenant. Eventually, I lowered it to VND100 million per month, and then someone immediately rented it. If I had stubbornly stuck to VND120 million, I would have lost VND1.2 billion last year."

Reader Cai Vang:

"I have a house for rent and for the last 10 years, I have not changed the price. In these 10 years, only two families have rented it. The first family rented for four years then left because they bought a new house and the second family also bought a house but then rented it out and continued renting my house to live in. I will not lose my decent customers due to short-term greed."

Read saigon84:

"It is not that the value of physical spaces has diminished, but rather the digital age has made such spaces less essential. Nowadays, the value of online transactions is much higher than sales at traditional stores, making the need for physical spaces less necessary than before. Many companies now have a more convenient and cost-effective 'space,' which are e-commerce platforms."

So what is your viewpoint on this matter?

*These comments were translated into English by AI. Readers’ views are personal and do not necessarily match VnExpress’ viewpoints.

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