 DELAWARE - The Delaware Department of Justice is warning manufactured home community owners that combining two methods of increasing lot rent in the same year may violate state law.
In a letter sent to community owners last week, the DOJ said it received multiple consumer complaints about recent rent increases. The complaints raised concerns about landlords applying both inflation-based increases and phased-in market rent increases during the same 12-month period.
Under Delaware law, community owners may base lot rent increases on the Consumer Price Index for All Urban Consumers, market rent or a separate written agreement with a homeowner.
The DOJ says the law does not allow owners to combine the inflation-based and market rent methods in the same year.
The state's Manufactured Homes and Manufactured Home Communities Act limits rent increases to once in any 12-month period and outlines specific requirements for calculating increases.
When community owners choose to bring rents up to market rates, the law requires the increase to be phased in through equal increments over seven or 10 years. The planned increases must be communicated to residents in the first year.
The DOJ says combining the two methods could violate state law and potentially the Delaware Consumer Fraud Act.
The letter urges community owners who have implemented multiple rent increases in the same year to take corrective action to comply with the law.
The DOJ's Consumer Protection Unit says failure to do so may result in enforcement action.
