Increasing rent on property

Why do you want to increase their rent?

Can you not do a search on rental property rates in your area?

What does it say in the tenancy agreement?
Generally after the first year it can be done at any time, but you must give notice.

Four years is a long time and rental prices have gone up enormously. I don’t think it would be fair to suddenly expect them to pay a big increase.

It’s a judgement call really. Are they good tenants, take care of the property and pay rent regularly? You don’t want to lose them.

An increase that covers your increase in expenses would be reasonable. House insurance, annual gas and electrics checks, boiler service, certificates for things like Legionnaires, all the other legal requirements have all increased dramatically over the last four years so you are effectively getting quite a bit less in income than you were four years ago.
Also factor in the increase in the cost of maintenance and repairs.

and then perhaps a sum for inflation. Though that may be too big a jump to expect all in one go.

Hopefully your tenants will see the logic in that.

Frankly though I think you should do this on a yearly basis rather than letting it go four years when the rise is such a big stretch.

The Renters Rights Act becomes effective on the 1st May 2026 so in just under two months time.
If you are thinking of taking professional advice for any aspect of your Landlord activities can I recommend " The Good Landlord Handbook " available on Amazon by Suzanne Smith who runs The Independant Landlord Hub.
She is excellent and her advice on the new rules for doing rental increases will be spot on and invaluable.
If your tenant cannot pay an increase then you may lose " the perfect tenant " ?
How will you find out whether they can afford an increase or not? I don't know.
You could employ an Agent to deal with the legal complexities in the short term.

Obviously I don’t know your financial situation, but don’t forget that you could end up paying tax/more tax, so allow for that in your calculations.

If they’re good tenants, I’d certainly be cautious about any big increase. How does the current rent compare to averages in the area? Have they shot up in the past few years?

Our rental flat is in an area where rents really have soared. It’s often said that it’s down to landlords’ costs, but TBH I’ve been familiar with the area for well over 10 years now, so I do know that many of the properties were bought for relative peanuts.

IMO the sharp increases are very often just because they can - the demand is so high.

Apart from the first year or two, the rent for ours is now considerably below the local average, but we’ve always had very good tenants who’ve looked after the place, so to us it’s been well worth it.

Initially we had a managing agent* who urged us every year to raise the rent, just because we could, and IMO ‘because we can’ is the reason for a good many rent increases.

*after the first very few years we ditched the agent for sheer incompetence, and (except for the initial letting, now via Open Rent) have since largely managed it ourselves.

Most of the increases mentioned in the first para (insurance, gas and electric checks, maintenance etc are tax deductables so these should be claimed against tax. Reember that you can claim them as expenses but your tenant cannot. Its all very well saying that a rental is a business but if your tenant cannot afford an increase you may be faced with a long and expensive eviction.

Bear in mind that after the new legislation comes in the tenant can lose nothing by appealing to the rent tribunal to set a fair rent. There is bound to be a long delay for this and you could not legally raise the rent in the meantime. I suspect that many tenants will go to the tribunal for the sheer hell of it "because they can".

In the case where a rent has fallen below market level because the tenant is long stay this often means that the property has not been refurbished during their tenure and may well have fallen below accepted standard. There is a difference between a "market rent" for an area (where the property is up to a certain standard) and one where the property has become a bit of a time warp because the kitchen, bathroom, heating etc are old and not up to currect standard.

Landlords should always be prepared to negotiate on rent increases as this is good business. Any more than 5% in the current market would probably be excessive.

Is there a landlords association in your area?
In Scotland there the Scottish Association of Landlords for a yearly subscription and you can call as often as you need for advice.

Grandmabatty

Why do you want to increase their rent?

Probably because over four years, the cost of maintaining servicing and insuring the property have risen.

Witzend

If they’re good tenants, I’d certainly be cautious about any big increase. How does the current rent compare to averages in the area? Have they shot up in the past few years?

Our rental flat is in an area where rents really have soared. It’s often said that it’s down to landlords’ costs, but TBH I’ve been familiar with the area for well over 10 years now, so I do know that many of the properties were bought for relative peanuts.

IMO the sharp increases are very often just because they can - the demand is so high.

Apart from the first year or two, the rent for ours is now considerably below the local average, but we’ve always had very good tenants who’ve looked after the place, so to us it’s been well worth it.

Initially we had a managing agent* who urged us every year to raise the rent, just because we could, and IMO ‘because we can’ is the reason for a good many rent increases.

*after the first very few years we ditched the agent for sheer incompetence, and (except for the initial letting, now via Open Rent) have since largely managed it ourselves.

Witzend, the fact that property values have risen, is a reason why landlords have more at stake. As property values increase, so does the cost of insuring it.

Any tenant, whatever their previous history, can face a major life change such as illness, redundancy, divorce, which makes them unable to afford the rent so they default payments. Or, the new stress affects their mental health , they start abusing drugs /alcohol and suddenly, they are no longer taking good care of the property or maintaining good relations with its neighbours, or the landlord. With financial and legal repercussions for the landlord . At the same time, national law and very local letting regulations can change quite fast.

When push comes to shove, any tenant will prioritise their own needs ahead of the landlord's.

There are all reasons why a property owner managing their own property let, needs to keep a close eye on their Landlord Insurance policy and pay whatever increase in premium is required, to protect their interests ans their asset.

Yes you should increase the rent perhaps by a small amount.

I would check out the property properly on your next inspection then decide.

Do you have a spreadsheet of outgoings/income received?
If not then do, you need to know what extra costs you are paying every year.

butterandjam

Grandmabatty

Why do you want to increase their rent?

Probably because over four years, the cost of maintaining servicing and insuring the property have risen.

Exactly.

I've just sold my flat. It wasn't my intention to become a landlord, it belonged to my late brother. However, we've had tenants for some dozen or so years, a bit of a mixed bag. I always tried not to increase the rent during a tenancy, usually mine ran for about 3 years. My last tenants did the dirty on us and whilst they stumped up, we only found out from the flat below, they'd turned the 2 bedroomed flat into one of multi occupancy, instead of 2 people sharing there were about half a dozen and that showed in the wear and tear. The letting agents I used were bloody useless, in fact more than that they actually stood in the way of sorting out problems as to getting trades people into fix any issues. Disillusioned with their own appointed panel who charged top dollar and were beyond inept, sometimes having to get them back to sort the same problem twice, so much so we even began to suspect them of setting up potential problems. The final straw, when I was told I needed a new heat pump for the shower room, I asked for the spec. they had the damn cheek to tell me, the mug who was paying their bill that "they weren't prepared to divulge that information" I've never been told that before by any plumber who had ever installed anything for us. At which point I told the letting agents we were going to find our own plumbers etc., which of course kind of made them redundant and not worth the 12.5% plus vat monthly charges. When we told them the tenants had been subletting they kind of shrugged that off with a "yes not that uncommon" Thanks a bunch! Full management is a bit of a joke, it's Monday to Friday management that's standard, if there's a problem weekends, the tenants are on their own, there isn't an emergency out of office hours they can ring. If we'd been living closer to the property, about 35 miles away, we'd have considered managing it ourselves if we hadn't sold it.

We sold it with a view of the proposed legislation coming down the line, whilst I appreciate that tenants need protection and there are a lot of unscrupulous landlords, none more so than the Labour MP who has quite a few filthy, mould infested flats, allegedly didn't know that because his mate was managing them and didn't tell him the state of his properties yeah right! All in all Labour has more than 40 MPs who are landlords, not forgetting the illustrious now resigned "Homelessness Minister" who shafted her own tenants making them homeless, but woe betide any landlord who doesn't comply with the prospective Renter's Rights Bill from the government of Doastheywontbedoneby.

Well said TerriBull.

Then the powers that be wonder why anyone wants to be a landlord.

🤷‍♀️

I’m afraid you’re have certainly missed out if you haven’t increased the rent for four years so now is certainly the time.

We usually go by advice from the letting agent we use, plus we do our own research to see what similar properties in the area rent for.

Yes it’s true that good tenants who don’t cause any problems are worth trying to hang on to, but renting out property, even on a small scale like we do, has to be run like a business where the figures need to add up otherwise what’s the point?

I’m sure your tenants are well aware of how lucky they’ve been to have had no increases in all those years so any rise hopefully shouldn’t come as a surprise!

You need to check the tenancy agreement which should detail rent increase procedure and follow government guidance.

Private renting: Rent increases - GOV.UK share.google/Fr64msDpa7Ty06vVS

Make sure you comply with the standards detailed in the new Renters' Act when it comes into effect.

Above advice is for England

Marthjolly1

I inherited a 2 bed property a few years ago which I rent out. The current tenants have been in for over 4 years now. I manage it myself and have a good relationship with the tenants. I'm wondering when I should/can increase the rent and by how much. I can't find any guidance on this and wonder if any grans might be able to give me some advice. TIA

When we were renting privately, the landlord would increase the rent every year, usually by £50 per month.

butterandjam

Grandmabatty

Why do you want to increase their rent?

Probably because over four years, the cost of maintaining servicing and insuring the property have risen.

Agreed.

We've always increased rents, for reasons listed. Inflation.

P.S. I shoukd say that he always gave notice of the increase via email two months before .

We rented from 2018 -2022, our rent didn't increase until that last year when he put it up by £50,we were actually moving away so when landlord put it upfor new tenants he increased the rent by £100 !

Calendargirl

Well said TerriBull.

Then the powers that be wonder why anyone wants to be a landlord.

🤷‍♀️

Absolutely - and trust me, if I had the option, I wouldn't be one any more. Unfortunately, our two flats are part of our own property and for reasons I'm not going to get into, I can't sell it, at least not for the foreseeable future.
However, the two flats are rented out for a good deal less than comparable properties around here. One tenant has been with us for more than 20 years now and you couldn't wish for a better tenant - for us, it's worth that rather than hiking up the rent for the sake of it.
But - and it's a big but - the rules and regulations around renting property are becoming more and more cumbersome now. We comply with them to the letter, but renting is definitely not something I would be doing now if I had that choice.

We had some very good tenants for about 14 years. I only ever put their rent up once in all that time and it was only by a very small amount. They moved to a disabled bungalow.

We now have a different tenant in there but we were advised that we were charging far too little. We are now getting double what the other tenants paid and already similar properties are charging much more.