RENT INCREASE REQUESTS
Eligibility for a Rent Increase
CHA must process and approve any rent increase or changes in utility responsibilities for HCV Program participants before they are implemented.
Property owners are eligible to request a rent increase to go into effect any time after the end of a lease term (normally 12 months but no more than two years) but may submit no more than once annually. Changes to the Contract Rent amount and/or utility responsibilities cannot go into effect in the middle of a lease term.
To account for CHA processing and proper tenant notification, as required by the Chicago Residential Landlord and Tenant Ordinance (updated July 2020), property owners should submit rent increase requests 60 days prior to the date that they want the increase or utility change to go into effect if the participant has lived in the unit less than three years, and 120 days if they have lived there for over three years.
Example: The lease term ends on April 30, 2020 and the property owner is seeking a rent increase effective May 1, 2020. Depending on the length of tenancy, the property owner should request a rent increase on either March 2 (60 days prior) or January 2 (120 days before).
- If the property owner chooses to keep the tenant on a month-to-month basis, a subsequent rent increase could not go in to effect until May 2021 (one year later) even though a lease is not in place.
- If the property owner chooses to renew the lease for one year, a subsequent rent increase could not go in to effect until May 1, 2021.
- If the property owner chooses to renew the lease for a two-year term, a subsequent rent increase could not go in to effect until May 1, 2022.
Note: Rent increases will not be approved if any failed items identified by the most recent HQS inspection have not been corrected, or if the regular inspection is due prior to the effective date of the rent increase.
Determining a Rent Increase Amount
A rent increase request triggers CHA to perform a new rent determination, including a new rent reasonableness study of the market. This process takes approximately 30 days. If a rent amount change is approved, CHA will issue an Amendment to the HAP Contract to both the participant and property owner, listing the new Contract Rent amount (tenant portion + Housing Assistance Payment (HAP) amount) and the effective date of the change (typically 30 days out). If the request required a change in utility responsibility, CHA will contact the property owner to sign a new HAP Contract and submit a new lease reflecting the change.
Unlike the new-move rent determination, CHA does not take the participant’s affordability into account when processing the rent increase. As a result, the participant, not CHA, will most likely be responsible for paying the difference if a rent increase is approved. If the participant does not wish to absorb the increase, he/she may request moving papers from CHA.
Important items to consider:
- Requesting a rent increase triggers CHA to perform a new rent determination. If CHA determines that your market value has decreased, the Contract Rent will be automatically lowered accordingly. Therefore, it’s extremely important to do your due diligence and research the market before submitting a rent increase request.
- Even if the property owner and participant mutually agree to change who is responsible for paying any utilities, the property owner must submit a rent increase request and be approved by CHA before the change can go into effect. A new HAP Contract and lease will be required for any change in utility responsibilities.
- Participants should not pay an increased rent amount or sign a new lease agreement accepting a rent increase or change in utility responsibilities until the rent increase request has been approved by CHA and an Amendment to the HAP Contract notice (or new HAP Contract) has been issued outlining the new tenant portion and HAP amount.
Please see CHA procedures on approving rent increases.
All rent increase requests must be submitted via the HCV Owner Portal. To request a rent increase for your HCV unit, please visit chahcvportal.org and click on the FINANCE menu. For a short tutorial video on the process, click here.