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Rent Increase Notices: Understanding Fair Rent Increases as a Landlord

Apr 17, 2024

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When it comes to rental agreements, it's important for landlords to consider how and when rent increases will be addressed. The specifics can vary depending on the type of tenancy in place.

Periodic Tenancies

For tenancies that roll on a week-by-week or month-by-month basis, landlords can typically only increase rent once a year without the tenant's agreement.

Fixed-Term Tenancies

During a fixed-term tenancy (e.g., six months), rent can generally only be increased if the tenant agrees to it. If not, any increase can only take effect after the fixed term concludes.

Rent Review Clauses

Some tenancy contracts include rent review clauses, outlining when and how rent increases will occur. This clause specifies the timing of the increase, the notice period provided to tenants, and the calculation method for the increase amount.

If you need assistance managing payments or drafting tenancy contracts, butters john bee's property management services offer dedicated support to landlords. Learn more about Landlord Advice.

Section 13 Notice

When a tenancy agreement lacks a rent review clause or has expired, and the landlord wishes to raise rent, a Section 13 notice can be used. This notice requires at least one month's notice for weekly or monthly agreements, and up to six months for longer-term agreements.

Determining Rent Increase Amounts

Landlords must obtain tenant permission for rent increases exceeding previously agreed amounts. The increase should also align with local average rents for similar properties.

For instance, if one-bedroom flats in an area rent for around £600 per month, it wouldn't be fair to ask £900 for a comparable property in the same location.

Notice Period for Rent Increases

Landlords must provide adequate notice before increasing rent. For weekly or monthly payments, one month's notice is required. For yearly tenancies, landlords must provide 6 months' notice.

Remember, rent increases during fixed-term tenancies can only occur if explicitly allowed by a rent review clause in the tenancy agreement.

Proposing a Rent Increase

Landlords can propose rent increases by:

  • Renewing a tenancy agreement at the end of the fixed term with an increased rent
  • Agreeing to a rent increase with the tenant and documenting the agreement
  • Using a 'Landlord’s Notice Proposing a New Rent' form to increase rent after the fixed term ends

Tenant Response to Rent Increases

Tenants can refuse a rent increase and challenge it through a tribunal process (e.g., Section 13). During this time, they must continue paying rent at the existing rate.

If landlords and tenants cannot reach a rent agreement, the tenant may decide to vacate the property.

For expert advice tailored to your local area, butters john bee offers comprehensive support to landlords and tenants alike. Contact us!

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