How Much Rent Should You Charge? Setting Market Rent

Setting the right rent price is the single biggest factor in how quickly your property leases and how long your tenant stays. Price too high and the property sits vacant. Price too low and you leave money on the table every month.

Washington's 2025 rent stabilization law now shapes every increase. Rent cannot go up during the first 12 months of a tenancy, annual increases are capped at 7 percent plus inflation or 10 percent, whichever is less, and owners must give at least 90 days written notice, and more in some cities; Seattle requires 180 days, and Kirkland requires 120 to 180 days depending on the size of the increase.

Sagareus conducts a market rent analysis before every new listing and lease renewal, comparing your property to active and recently leased comparable units in the same area.

A disciplined, documented rent process does three things for you as an owner:

1. Keeps rent aligned with the market, so the property generates enough to fund proper maintenance and repairs instead of falling behind.
2. Avoids the painful catch-up increase. Small, regular adjustments keep good residents in place; a sudden large correction after years of no increases is what drives them out.
3. Protects you from claims of favoritism or retaliation, because every increase follows the same documented policy.

This article covers how Sagareus stays current on market rent, and how to increase rent fairly, ethically, and legally under Washington's current rules.

How to Establish Fair Market Rent

Rent Schedule

Establish a standard review schedule first. Sagareus reviews every unit for a potential increase once a year. 

Our process starts in a simple spreadsheet with columns for each unit being managed: square footage, current rent, market rent, last increase date, post date, and increase date. This sheet is labelled Rent Schedule.

Within the same file, we have another sheet labelled "Rental Comps" to help us determine market rent for our subject properties. We enter 3 to 5 comparable rentals near our subject properties, average the price per square foot to determine the market rent for our units, which autofills on our Rent Schedule.

Finding Rental Comparables

Rental comps are part art, because nothing public shows what each unit actually rented for. For example, a landlord may advertise a unit for $1,600 per month but actually lease the unit for $1,450 per month, and we would never know.

The best we can use is the ads. Potential renters are looking at the same ads we are, so as long as we are in the appropriate price range, our pictures and copy are the best on the market, and our lease terms are competitive, we will schedule showings and secure a lease.

Every other month, we go to Zillow and find comparable units. We input the asking rent and the square footage and adjust for parking, water, sewer, garbage, whether there is a balcony and an elevator, and what kind of rental pet policy is in place.

Adjusting for Variables

Be realistic about what your rental actually offers. Very often property owners have an over optimistic view of their property features. Only include properties that are within a 10 to 15 year range of your property, if possible. Transportation options including access to freeways, parking, and transit centers are major location factors; layout, flooring, and pet policies are major property factors.

Our spreadsheet allows us to rate the units 0 to 1 to adjust the pricing somewhat, based on these features. For more dated units, we may rate the unit 0.9 to bring down the market rent; or, on a fully remodeled unit being compared to older units, we may use 1.05 to bring the value up.

Over Market Rent

You may find that some of your units are at or above what you believe to be market rent. If this is the case, upgrade the unit rather than hold the line on price. Upgrade your rental property: install new countertops or upgrade the bathroom for your tenants; install a ceiling fan or garbage disposal if there isn't one there. If you bring the value of the unit up, your tenant will feel they are paying market rent and be encouraged to extend their lease. If they feel they are paying too much, they will move. Wouldn't you?

The 2025 Rules Every Rent Increase Must Follow

Washington adopted statewide rent stabilization in May 2025 (RCW 59.18.700 through 59.18.720), and it changed the mechanics of every increase:

• No increase in the first 12 months of a tenancy, regardless of lease type.
• Annual cap: within any 12-month period, rent may rise by no more than 7 percent plus the Seattle-area consumer price index, or 10 percent, whichever is less. The Department of Commerce publishes the exact maximum percentage each year.
• Vacancy resets the clock. When a tenant moves out, you may set the new asking rent at market with no cap.
• Exemptions exist, including units whose first certificate of occupancy is 12 or fewer years old and certain owner-occupied situations. If you claim an exemption, the rent increase notice must state the supporting facts.
• Notice: at least 90 days written notice statewide, on the form the statute prescribes, and the increase cannot take effect before the current lease term ends. Seattle requires 180 days under its own ordinance, and several cities set their own tiers: Kirkland, Kenmore, and Shoreline require 120 to 180 days depending on the size of the increase, and Auburn requires 120 days for increases over 5 percent. Always check the property's city.
• Lease type parity: you may not charge more than a 5 percent difference in rent between month-to-month and fixed-term agreements for the same unit.
• Penalties are real. An unlawful increase exposes the owner to repayment of the excess, damages of up to three months of rent, and attorney fees, and the tenant may terminate the lease with 20 days notice.

Our guide to Washington lease renewal and rent increase notices covers the notice mechanics in detail. This is general information, not legal advice; for an unusual situation, involve a landlord-tenant attorney.

Implementing Rent Increases

To increase rents ethically, fairly, and legally, set a rent increase policy and document your follow-through. Ours is:

1. Update market rent every 3 to 6 months (March, June, September, and December).
2. Increase rent no more than once per year, never within the first 12 months of a tenancy, and always within the published statewide cap.
3. Provide at least 90 days written notice on the required statutory form; 180 days for Seattle properties, and 120 or 180 days in Kirkland depending on the size of the increase.

If It's Not Documented, It Did Not Happen

At each review, we update the market rent spreadsheet, save it as a PDF, and upload it to our property management software so it is date stamped. Any comments and observations are noted here as well, such as "Not much change from last review" or "New building .3 miles away, 24 units."

We keep careful records so that if someone wants to know why the rent was raised, we can show them the documentation demonstrating how we came to the rental amount.

Document your rent reviews and increases; this shows they are part of your normal routine procedures. There may come a day when someone accuses you of raising their rent as a form of retaliation, and this documented process proves otherwise. Under the 2025 law, that documentation also proves every increase stayed inside the cap and followed the notice rules.

Fair Market Rent Conclusion

A regular, consistent, well documented rent schedule keeps your property funded, keeps increases small and predictable for residents, and keeps you compliant with Washington's cap and notice requirements. Falling behind on rent reviews hurts both sides: the property's upkeep suffers, and the eventual correction is harder on the resident than steady annual adjustments would have been. The process above is exactly how we manage it at Sagareus.

How Sagareus Handles Leasing and Marketing

A vacant home is won or lost on speed and presentation, so we treat both as disciplines, not hopes. Every day a unit sits empty is income the owner never gets back, and the listing that responds first and looks best is the one that fills. Here is how we run it:

• Respond to every lead fast, within minutes. The first responder usually wins the showing, so inquiries get a real answer right away, not whenever someone gets to them. Every showing is scheduled and accompanied by our team.
• Professional photos and a standards-based listing, no exceptions. Real photography, an accurate description, and complete amenities. We do not cut this corner, because a weak listing quietly costs weeks of vacancy.
• Price to the market, then adjust on activity, not ego. We set the opening rent from current comparable rentals and your priorities, then watch inquiries and showings against pre-planned checkpoints and move when the data says to.

You set the goal, whether that leans toward top rent or fastest occupancy. We bring the market read, run the system, and report the numbers every week until the lease is signed.

Speed and presentation are not luck. They are how we shorten your vacancy.

Setting market rent is one piece of leasing a rental property in Washington, from pricing and marketing through screening and lease signing.

Related Sagareus Services:

• Professional Leasing Services