Rent increase or vacancy: a break-even method

The idea in one sentence

A rent increase brings in a little more every month. A vacancy takes away a lot at once. The break-even calculation tells you how many months of the extra rent it takes to make up for one vacancy.

This is a way to think, not a prediction. It does not tell you whether a tenant will leave. It tells you how much risk a given increase is worth taking.

How to calculate it

1. Find your cost of one turnover. The cost of tenant turnover guide has a worksheet.
2. Decide the increase you are considering, in dollars a month.
3. Divide the turnover cost by the monthly increase. That is the break-even in months.
4. Ask whether the tenant would plausibly stay at least that long, and whether the increase is likely to push them out.

Example a made-up unit has a turnover cost of $2,400. You are weighing a $100 a month increase. Divide $2,400 by $100: 24 months. If the higher rent causes the tenant to leave, you would need two years of the higher rent from the next tenant just to break even on the vacancy.

Example with the same $2,400 turnover cost, a $40 a month increase has a break-even of 60 months. A small increase is almost never worth losing a good tenant if it makes them leave.

How to read the result

A short break-even, say a few months, means the increase pays for itself quickly and a vacancy would not hurt much. A long break-even means a vacancy would be expensive compared with what the increase earns, so the cautious move is a smaller increase or none.

Two things change the picture. A unit that rents quickly has a lower turnover cost because its vacancy is short. A unit that is slow to rent, in a weak season or a thin market, has a higher one. Use your own days-to-rent, not a guess.

What the calculation does not decide

• Legal limits. Some states and cities cap or restrict rent increases and require a longer notice for large ones. See Oregon's cap, New York's good cause limit and the California and Washington limits.
• Notice periods. Washington requires 90 days of written notice under RCW 59.18.140 and Oregon requires 90 days under ORS 90.323; other states differ. See how much notice to give.
• Quality of the tenant. A tenant who pays on time and keeps the unit clean is worth more than the same rent from someone unknown.
• Fairness. Apply your rule the same way to every tenant, and do not choose increases based on a protected characteristic.

Pairing it with a market check

Use break-even alongside a comparison of similar units nearby. How much should you raise rent walks through that method. If the market supports a higher rent and the break-even is short, raise it. If the market is flat and the break-even is long, a small increase or a renewal at the same rent keeps a good tenant and avoids the vacancy.

How DoorKeeping handles it

DoorKeeping keeps your rent roll and each lease's end date. Ask Claude or ChatGPT, for example: "For leases ending in the next 90 days, show current rent and what a $50 increase would add per year." You choose the new rent; DoorKeeping does not set it for you, and the renewal offer waits for your approval before it goes to a tenant.

Sources

1. RCW 59.18.140, Rent increase notice, Washington Legislature, read Oct 30, 2026
2. ORS 90.323, Rent increase notice, Oregon statutes, read Oct 30, 2026

Questions

Is it better to raise rent or keep a good tenant?

Compare the extra rent to your cost of one turnover. If the break-even is longer than the tenant is likely to stay, a smaller increase is usually safer.

How do I calculate the break-even?

Divide the cost of one turnover by the monthly increase. The answer is the number of months the higher rent must last to pay for a vacancy.

Does this work for every market?

It is a way to weigh risk, not a forecast. Use your own turnover cost and days to rent, and check your state's limits and notice rules before you set a number.