Rate hike: Lancaster City annual occupancy rental fee increased from $50 to $250 per unit

By: Sean Guay

Lancaster, Pennsylvania – Landlords in Lancaster City are reacting after recently receiving an invoice for a massive property rental fee increase in the mail.

The annual occupancy license fee which was formerly $50, has now increased to $250 per unit, according to property owners who said they were given no warning of the massive rate hike until seeing the invoice.

Lancaster area realtor Jess Flowers told Harrisburg100 the rate increase was passed by the city and it originally included a provision to conduct lead testing in rental units. She said, “When property taxes, hazard insurance, city regulations, and landlord expenses go up due to tenants neglecting homes, so do rental prices. Many landlords do not have a lot of profit margin, if any, on their rental properties. Many eat a lot of expenses out of their own pocket. At some point, the tenants end up paying for all of these factors; as they would if they owned a home.”

I almost fell over when I got my $250 bill for my one rental unit. It’s a shame, trying to provide nice affordable housing for folks is becoming impossible because of this type of nonsense.

Cathy Rychalsky

One landlord stated that due to this and other factors, rent will be increasing in his building in January. Another landlord who prided herself on offering affordable housing in the city is very unhappy about the increase, and said she previously was able to keep her disabled tenant’s rate the same for 12 years. Unfortunately these residents will bear the brunt of the increased fee.

Lancaster area realtor Amy Beachy also offered her perspective, saying that rents in the city will continue to increase. “It mostly stems from the lack of inventory at all, and they know so many people are looking for places to rent, so a lot of landlords are significantly increasing their rates.” Amy said the overall supply and demand of the real estate market is likely a contributing factor coupled with other issues that exist in the city rental market.

Lancaster City Councilwoman Janet Diaz responded to a request for comment from Harrisburg100. She provided the following statement: “Since 2022, Lancaster County has experienced the highest rent increases in the region at 4.8%, surpassing Lebanon County at 3.2%, with all other surrounding counties registering below 3%.”

“Low- and moderate-income households in Lancaster County allocate 30% to 50% of their income towards rent, reaching a level considered cost-burdened for low-wage earners.”

“Landlords in the area are obligated to cover 10% of contract costs and contribute $600 towards resident relocation costs for lead cleanup.”

“Lancaster serves as an indicator for potential housing shortages, with changes in the number of housing units being a key metric alongside population changes. Lancaster exhibits a Housing Unit Change of -3.7%, ranking as the second smallest among all places in the metropolitan area. In comparison, Lampeter CDP has the highest change in housing units at 32.3%—a significant increase. When compared to the United States average of 7.4%, Lancaster’s change in housing units is relatively similar. Moreover, when benchmarked against the state of Pennsylvania, with a housing unit change of 2.9%, Lancaster is 28.9% larger.”

Realtor Bailey Quinn provided further analysis of the rate hike to Harrisburg100. She said, “There have been increases in all rental fees, for a few years now. Lancaster is starting to become a more populated area, meaning the demand to live to in PA is so great, that landlords know they can increase prices, and there will still be the demand.”

“I have been attempting to help renters find a rental, and it’s been the most difficult I’ve ever seen. 20+ applicants for each rental, and I even had renters who were willing to pay a years rent in advance, and they still didn’t get the home.”

“Not only is the rental market in full demand, but home prices have gone up dramatically in the past few years, as well. Costs of materials have also gone up, which means anything the landlord needs to fix, will cost more, hence why they need to raise their prices.”

A link to Lancaster’s annual rental fee policy can be found here.