Modest rent increase or retain a reliable Lisbon tenant?

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Landlord
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I need to decide what to propose before the next permitted review or notice point. The trade-off is between moving the Lisbon townhouse closer to current asking levels and retaining a tenant who pays reliably and takes care of it.

The tenant now pays about €1,783, while apparently comparable advertisements are near €2,242. I doubt the full difference is recoverable once vacancy time, preparation work and the uncertainty of a replacement tenant are included. I am therefore considering a smaller adjustment, provided the comparison is sound and the contract and Portuguese rules allow it.

Anyone.com messages have helped keep the property context with the conversation, but I still need to verify the numbers and legal timing separately. How would you explain a measured increase fairly, and what turnover costs would you include before choosing the amount?
 
I’d put a value on retention before proposing a number. Compare the extra annual rent with a realistic vacancy period, preparation costs and the risk that a new tenant is less reliable. A good tenant already has economic value.

Once you have checked what the contract and current local rules permit, explain that you reviewed the rent but deliberately chose not to seek the full asking level.
 
One important question: is €2,242 based on genuinely comparable Lisbon townhouses, or a wider group of advertised properties? Asking rent is not necessarily achieved rent. Also, where are you in the contract or renewal timeline? That may determine both what is allowed and when any notice must be given.
 
The €2,242 is an asking-rent comparison rather than evidence of completed agreements, so I agree it should not be treated as an automatic target. The linked messages helped me keep each property discussion attached to the right context, but did not establish the final market value.

I haven’t settled on an adjustment yet. My next step is to check the contract dates and the notice requirements before replying to the tenant.
 
The visible gap is €459 a month, or €5,508 over a full year. That sounds substantial until you set against it even a period without rent plus cleaning, repairs or refurbishment. I would not anchor the tenant discussion at €2,242 and then present a discount. Start from the sustainable rent you actually want for this tenancy.
 
I’d add a legal caveat to that sequence: confirm first whether an increase is permitted at this point and what form and notice are required under the contract and the rules applying in Portugal. An informal conversation is useful, but it should not accidentally replace any required written step.

Keep the deposit separate from this calculation too. Any deductions or return at the eventual end of the tenancy should be handled under the agreement and applicable rules, not treated as a general turnover fund.
 
A practical order would be: verify the contract and timing, narrow the comparisons to similar townhouses, estimate vacancy and refurbishment exposure, then choose a defensible adjustment. After that, send a calm written explanation and invite the tenant to discuss it.

I agree with not leading on the portal asking figure. Payment reliability and care of the property are strong reasons to accept less than the theoretical maximum.
 
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