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Rent Increase

Started by Carla, May 06, 2019, 03:09:12 PM

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Carla

I have a tenant who's been renting my house for almost 2 years.  His (second) AST 12 month Agreement expires in July.  During this time I have not increased the rent but I want to increase it when the current Agreement comes to an end.  (I think he will most likely be wanting to stay in the property for a further period but he has not confirmed this yet).  What I would like to know is:

1.  Is it reasonable to increase the rent by 3%, or is there a limit to what percentage I can increase it by?

2.  I propose to give him two months notice in writing of the increase (which is what it says in the AST agreement he's signed).  Is this right, only I've just read somewhere that you have to give 6 months notice.

3.  Can I just send him an e.mail / letter informing him of the proposed rent increase should he wish to continue renting the house, OR is there a specific form that I need to use?

3.  If he does want to stay in the property, is it better for me to offer him another 12 month AST or would it be better not to get him to sign another 12 month AST and simply let things slip on to a month to month rolling contract?  I'm confused as to which way is best.

heavykarma

You don't have to give 6 months notice.3% is around what I aim at if increasing rent.You can ask whatever you choose,but the tenants can challenge,or hand in notice.Voids can work out very expensive,not worth the risk.There is a specific form I understand,but when managing myself I have always done as you are intending,with 2 months clear notice in writing.It is better all round to go onto a periodic (rolling) contract.

Carla

Thanks very much for taking the time to reply.

theangrylandlord

#3
Funnily enough I did this yesterday...

Form link below. Not strictly necessary but does have some notes for the tenant to read so it’s all above board.

https://www.gov.uk/guidance/assured-tenancy-forms#form-4

Hippogriff

Quote from: Carla on May 06, 2019, 03:09:12 PM3.  Can I just send him an e.mail / letter informing him of the proposed rent increase should he wish to continue renting the house, OR is there a specific form that I need to use?

You can do this, and it's often the best way (it's the only way I would contemplate it, myself)... it's basically you two agreeing a rent increase. Yes, we know that they didn't come to you asking for one, and you're really enforcing it... but it's gotta be better than some Section 13 hitting them.

Like Deposit deductions, if you can do it by agreement it's always gonna be better. So I have become quite skilled at writing emails that explain my modest rent increase is not intended to abuse them and extort them... it's kinda in-line with inflation measures, and it's really just to help offset my own increasing costs (GSCs and Insurance etc., not maintenance, because maintenance issues and rent increases should not be linked - you can't say "I had to replace the boiler this year, so I'm increasing the rent to help me out") and keep pace with market rates.

Always keep the increases modest and regular (annual) and you may find you never run into trouble - because your Tenants expect it and understand it. Problems arise when a Landlord has let a tenancy run for 10 years without any increase and suddenly hit the Tenant with a monthly increase of £250... it doesn't matter than they've had those 10 years of no increases, they've gotten used to their life and now they're forced out. This is what I call an incompetent Landlord.

Carla

Thanks all.... your advice/reassurance is much appreciated.   :)