Increasing rent on property

Primrose 53.
You sound like an experienced Landlord so not wanting to tell my Grandmothers to suck eggs obviously.
My point, if I had made it clearly, which I didn't is that the new Renters Rights Act imposes strict new procedures for all the paperwork attached to renting property and massive ( in some cases) fines for not doing it or getting it wrong and new rights for Renters to appeal Landlord's decisions that they don't like and then take any gripes to a Tribunal .
No offence. Only sayin'. Watch your procedures and paperwork .
Good luck.

Labradora

Primrose 53.
You sound like an experienced Landlord so not wanting to tell my Grandmothers to suck eggs obviously.
My point, if I had made it clearly, which I didn't is that the new Renters Rights Act imposes strict new procedures for all the paperwork attached to renting property and massive ( in some cases) fines for not doing it or getting it wrong and new rights for Renters to appeal Landlord's decisions that they don't like and then take any gripes to a Tribunal .
No offence. Only sayin'. Watch your procedures and paperwork .
Good luck.

Yes it was very much the strict new procedures coming down the line that sealed our decision to sell. For us it was the three pronged factors of headaches with the management company, we went from a low manageable annual charge to exponential rise in the past couple of years. Ours being a purpose built block the management company advised us last year that new internal fire doors were required levying an additional £2,500 per flat for these doors. They obtained three quotes for the block with something like a £20,000 differential between the highest and lowest so naturally owners cast a vote for the lowest quote, how would any of us know what would be the best price for a fire door anyway. These new ones we were told were mandatory, although each flat already had an existing fire door. Having paid the extra money well over 14 months ago, that amount has sat in their bank account because, surprise! surprise! not everyone could manage to pay up initially. Then they have the cheek to tell us that they are going to have to re-tender because the costs since the initial quote have gone up. However, what nearly scuppered our sale was another hefty charge levied at the beginning of this year for a proposed new roof, two tranches of something along the lines of £1,500, although they state that these works aren't actually urgent. My buyer got us to drop the price by £15,00 to reflect these unprecedented charges, he wanted some future proofing, which obviously we couldn't give him, that these unparalleled additions were out of the ordinary. We'd lost the will to argue by then it took six months from offer to completion with just a chain of a buyer and a seller, I had to pay a hefty £600 to the management company to send a required package to the buyer's solicitors and the amount of shilly shallying which should have been a straightforward transaction, quite honestly we just wanted out.

If we had re marketed the property we felt that we would have had to organise some meetings with the other owners in the block to mount some sort of offensive against the management company who were ripping everyone off. Having scrutinised their accounts there were some very dubious charges as to gardening and other items. I'd already emailed them to say that I didn't think they were acting in our best interests, unsurprisingly no reply.

Then there are the useless letting agents, money for old rope, they take the money and do very little for it, their panel of tradespeople are of the cowboy variety. Quite honestly it would be easier to have managed it ourselves, but along with the onerous new government compliance, on top of the paperwork required to send to our own accountant, lately it's snowballed into a less than desirable source of income. It wasn't always thus, when we first started letting, there were far more properties around, tenants could pick and choose, the supply has massively shrunk and the new Renters Rights Act is going to put off prospective landlords even more, possibly to the extent the market may dry up altogether. Quite honestly I wish this government would set their sights on leasehold management companies, who appear to have carte blanche to screw as much, often unsubstantiated money, out of owner occupiers.

The whole thing has become a massive headache of late, and yes have made money over the years but there are quite a few charges as set out and of course the onus, quite rightly, on the landlord to maintain the property. Certainly there's only a percentage of what was collected in rent that went in our back pockets.

Marthjolly1, in May the new legislation comes in and all the rules for renting property will change, including how you make increases in the rent. Personally I'd get some legal advice about what you can and can't do both for now and for after the new rules come into force, that is if you aren't already absolutely on top of it all.

I am landlord for just one property and have an excellent elderly tenant. I don't normally put the rent up because I'd rather have a slightly lower rent than two or three months with no rent at all if he decided to leave, I just put it up slightly last year for the first time for four years. Apparently he was pleasantly surprised and was expecting a rise.
My rent is slightly lower than other properties in the building have asked for, but I'm not sure what they actually achieved. We have no mortgage and the outgoings are reasonable, so perhaps I have more flexibility than many landlords.

We gave up being landlords due to the hassle it entailed @bd it was always ME sorting out the issues. One tenant separated from her partner, couldn’t pay the rent, had loud parties#, upset the very good neighbours. I had to have the police round to do a welfare check on her child. I ended up issuing a section 21 and she left.
Next tenants wanted us to change the layout of the property by moving walls! We refused so they left and we sold up. Never again!
My advice is if you have a good tenant, keep them happy. Don’t get greedy either.

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I've just looked at 'Open Rent' in my city in the West of England.

There are hundreds and all look absolutely grotty and almost all are in poor areas. I can't imagine any Agent would be willing to have them on their books.

And they often want over £3k a month. Even £1,600+ for a studio flat.

How can people afford it?
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I don't know how much you need the income from your rent. But you could be maybe getting a lot more than you are now.

It's up to you what you do. But l would say your tenants are lucky and have been living a very charmed life with no rent increases for 4 years. Your are a Private Landlord and don't owe them anything

There is a huge amount of great Gransnet Style information in response to your post.

I'm sure it could be useful to you in making your decision.

Good Luck🤞

I’m in a similar position re inherited property; it will have been rented to the same people for three years this year and is managed by an agent as I live quite a long way away.
I haven’t put the rent up at all but I may this year. A friend who rents out several properties (again an inherited estate) recommends increasing by a small amount every year as if something major needed to be done that you needed to recoup money for it is better for the tenant to pay a little more each year rather than suddenly be hit with a big rise.
I’ll talk it through with the agents and maybe just increase by the rate of inflation; after all, my costs have gone up by at least that.

I was in that position a few years ago, we didn't increase the rent at all and they were paying well under local prices, £800, which you can find on right move. I just said I'd have to increase the rent or ask them to leave and they offered £1,100. Apparently, once you've accepted one payment that is legally a new contract.
But after the new legislation in May we won't be able to do that because it's too big a jump in price and we won't be able to evict a tenant for that reason, so it has to be increased annually.

We use the Local Area Housing rates to determine our rental rates. This is considerably lower than market rent but seems to be a fair way to give people a chance to save whilst they rent. However, a few years passed without us checking (where does time go?) and the housing rates had gone up quite a lot. We talked to our tenants and put up their rents at 10% each year. It has taken a while to catch up but we didn't want our tenants to suddenly get a huge rental increase.
New rules say that rental increases can only be once a year and only by a reasonable amount.
With all the new expenses coming out of the rent in 2027, we might have to review our policy of matching Local Authority rates especially as the rates have been frozen again. I want to be generous to our tenants but we also have to live too. Rightly or wrongly, the rents are our pensions and it is too late to change that strategy now.

If it helps, social housing rents increase by 4.8% for the year 2026-2027 this is the maximum increase they can legally apply and is pretty average, year on year.

I'm a LL and have 12 properties to let out. I let my properties to families with usually young DC. Most have been with me for many years. I get an EA to value property and vet tenants at beginning of let. I increase rent every other year at whatever inflation rate is on anniversary of their moving in. I only let houses in a good condition I would live inyself. I'm super prompt with getting any maintenance issues resolved or white goods replaced often on same day they report a washing machine broken I have a new one fitted. I employ a self employed maintenance person to enable me to do this who prioritises my tenants as I give him a reasonable amount of work. I also have a gas safe plumber I used who does likewise. I know I am charging about 5-10 percent below market value but I like my tenants and they look after my houses. By only increasing rents every other year my tenants know they are getting a good deal and I'm happy because they look aftery investment. I have been invited to 2 weddings over the years and after I helped a single Mum out with a young baby over COVID by Louise king after baby when her Mum had COVID and was very sick and had no one else to help her so I fetched nappies and milk for her and changed and fed her baby when she was at her worst. I'm now the Godmother to the little girl who is now 6 1/2. I baby sit her occasionally so her Mum can go out sometimes. You need to put rent up now by about 7 percent then whatever inflation is on anniversary of this rent rise. Tenants much prefer a smaller annual increase rather than a large one every 4 years. By not increasing rent by inflation each year you will now be renting at significantly lower than market rent for your area. Over the last 5 years property rent has gone up a lot as we have had higher inflation.

Daffydilly

If it helps, social housing rents increase by 4.8% for the year 2026-2027 this is the maximum increase they can legally apply and is pretty average, year on year.

I read that they were frozen for 2026/27.

We increase by £50 per month per year which is a bargain. We also charge slightly under market value

standard is 3-5% per annum. But a bit too late to add 4 times.

My niece rents long term and gets a hefty discount for being a good long term tenant as the landlord who owns the block appreciates that he does not have to refurb every year or clear out after departing tenants. Even so, her rent has gone up by 15% over the last 4 years.

Discussions around increase in landlord insurance costs and his overheads and the fact that her salary has increased too. Plus average rents (Nottingham has shot up). He has had to add insulation and a new block gate, plus increase to gas safe and electrical safety checks have gone right up too. Factor in the cost of any appliances/alarms you have provided that have to be PAT tested and depreciation on those.

Do not forget that your tax bill will increase by 2% next year, so any increase needs to happen soon if not to hit them twice in the same year and you have to give 2 months notice of increase

I'm putting this here, which may be of interest to those who have a property/ties and are using a letting agent. The following are some clarification points outlined in an excerpt from a question and answer section in the Home section of today's ST's addressing the concerns of a landlord of 3 properties with regards to the prospective Renters' Rights Act legislation.

All tenancies will automatically convert to the new type. Any fixed term your tenants are in will cease to exist, becoming a monthly rolling tenancy instead. Tenants will be able to give two months' notice to leave at any time, and any early termination clauses in your present agreements will no longer apply.

The other big shift is the end of section 21 "no fault" evictions. If you want a property back to move into or sell, you'll need to give four months' notice. And if a tenant isn't paying rent or is in breach of their agreement, you'll need to prove this through the courts - a process that's already slow and will probably get worse as more landlords are funnelled into the same route.

On rents too, any increase written into present contracts will no longer apply. You'll be able to review the rent once a year and tenants can challenge it at a tribunal if they believe it's above the market rate.

It will also no longer be possible to invite or accept offers above the advertised rent, or to accept more than one month's rent in advance. If any properties are in an area where several months' rent upfront has been common - as it often is with international students, for example - your agent should be talking to you now about how to manage that transition, because it's going to change the way they let those properties.

This all happens automatically; the only thing that needs to be done is to issue tenants with a government provided information leaflet before the end of May. This is something your agent should handle. But your agent should be communicating with you now about any actions it might be useful you take before May 1.

If any of your properties is on a rolling tenancy - or its fixed term ends before May - you can increase the rent to reasonable market level while there's still no mechanism for tenants to challenge it. It's not an invitation to gouge anyone, but if your rents have drifted below market rate, now's the time to correct that. Your agent should also be helping you think about any tenants you may have concerns about, such as those with a patchy payment history. If you wanted to move someone on and they have a fixed term that ends before May, now is your window to do it before the process becomes longer and more uncertain.

There's one more thing worth thinking about that your agent is unlikely to raise because it could mean you taking your business away from them. Under the new rules, if you regain possession of a property because you want to sell it, or move in, you won't be able to re-let it for 12 months afterwards. And if you let a property to a new tenant after May 1, you won't be able to use those reasons at all during the first year of your tenancy. Add on the four month notice period and you're effectively locked in for at least 16 months. If you have any doubt about your long term plans for any of the three properties, it's worth having that conversation with yourself now rather than finding your hands tied later. On the point of fees, agents have a few reasons to be revisiting what they charge With the end of fixed-term contracts, annual renewal fees will disappear. Some agents also take their management fee for the entire tenancy upfront, which won't work when there's no defined term. Your agent might be waiting to see how their landlord base shakes out before committing. If they do propose increases you're not happy with, you should be able to reject the changes and end your management agreement - though they may not make that easy.

That said, the letting agents we speak to tell us that plenty of their landlords are selling up ahead of these changes, so agents are probably more focused on keeping your business rather than increasing fees.

FranP, there has always been the possibility of a tenant approaching the Fair Rent Tribunal but they did run the possibility that the Tribunal could actually raise it higher than the Landlord was asking for and could be backdated to the Section 13 notice. Now they won't be able to do that and the fair rent will only take place from the date of the Tribunal decision.
Similarly Landlords haven't been able to charge renewal fees since 2019.
As a LL I think many of the changes are good but I do think we are in danger of there being a lack of balance on the LL's side. I've been on both sides of the fence and of course I wanted protection as a tenant but as a LL I want that protection too. For example, it seems to me that if a LL is asking for a reasonable increase in rent, it should be from the date originally proposed rather than a Tribunal Decision which is likely to take months. A Landlord could find themselves facing an annual battle even though the rent increases are reasonable. I should have thought that the simplest way would be for the Government to look at the cost involved (new legal responsibilities, inflation, etc) and set a percentage rise allowed. At least everybody would know where they stood.

butterand jam, I’m all too well aware of increased costs for landlords, but in the small area I’ve been so familiar with for around 12 years now (both purchase prices and rents) the rent increases over the last few years have been enormous, and TBH I can account for them only by sheer greed on the part of landlords.

Demand in the area (SW17) is extremely high, so LLs surely know that someone will be prepared to pay whatever they’re asking.

On the last 2 occasions we re-let the property, we could have let it 20 times over, and I’m sure that was not solely down to the fact that we had kept the rent very ‘competitive’ for the area and the type of property.

We previously owned 5 properties, but have sold 4 and now only have 1 house which we let to a tenant who has been there 15 years. We have always managed properties ourselves, I don't trust the agents.
The rent is way below market norm for the area. We increase the rent by 3% every two years to cover our rising costs and always giving at least 2 months notice.
She is a very good tenant but we are also excellent landlords and as soon as a problem is raised, we deal with it.

The new rules are definitely weighted in favour of tenants, which is all very well, but as a significant number of landlords have already sold up, properties available to rent have decreased in number.
Where does that leave tenants? Struggling to find a home of course.

We will definitely be monitoring the situation to decide whether it’s still worth it for us to rent out property.

I manage mine personally, they are all long term commercial rentals, I did increase the rent 4 yrs ago, first for 10 yrs nobody commented they all expected more. My overheads are low not using an agent, they don't cause me any hassle, nor to others.
I used to have residential but the 50% good tenants didnt outweigh the 50% bad ones, with the new regulations leave it to the professionals.

We were in a rental property for 15 years; our rent increased every 3 years, by 10% - this was written into the lease, so we knew where we were & it helped with long term planning

When you are a landlord with possibly only one property it is easy to feel awkward when talking rent rise. But it is important that although being fair you are not taken advantage of. Son was in this position and when he did bring up the subject The tenants just said I was wondering when you were going to put the rent up. Al sorted and no ill feelings. I think fairness is on both sides