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Rather strangely the agency are happy for the Tennant to have a 12-36 month agreement and they have the contracts for such. However, they do not have a standard clause for an annual rent rise.
My renters have been in for 12 months and want to stay for as long as possible which is fine by me, but I don't want to shut the door on any rent increases.
I assumed google would give me a sample clause to pass on to the agent, but I am only finding paragraphs that then refer to other parts of the contract.
Can anyone from STW point me in the right direction (other than changing agent which is probably a bigger muddle to resolve)?
Never done an index linked rise. When the 12 month agreement was getting towards the end our agency used to contact us and ask if we were happy to renew with current tenants and did we want to increase the rent. We did it once in about 8 years.
Agents like long contracts as that is what their commision is based on. For increases I just leave them be as I value loyal tenants and hope they value me.
I do keep an eye on the market and if the rents fall below c15% of the market rate I would be having a word with tenants to forewarn them.
Good luck but don't getgreedy, law is in favour of tenants and they mostly know it.
I don't actually plan on raising it despite one of the indexes suggesting Rent rises of 9.5% in the last 12 months.
However, I don't want to give them a 3 year contract without the option of raising it if required/desired.
If you're in England check out the information here: Shelter - Rents and rent increases for assured and assured shorthold tenancies
@DougD - Yes, both I and the property are in England and that is a great site with the following statement;
a non-specific clause such as
'the rent will be reviewed by the landlord in April of each year, and the landlord will give the tenant four weeks' notice of the revised amount payable'
will suffice.
Hopefully that will do the job 🙂
I don’t want to give them a 3 year contract without the option of raising it if required/desired.
Why not?
Why not?
Things change.....not sure if your noticed but inflation and interest rates are rising.
the rent will be reviewed by the landlord in April of each year, and the landlord will give the tenant four weeks’ notice of the revised amount payable’
Bit short notice - I'd make it 2-3 months, just to be nice.
We've never upped the rent on a sitting tenant - just up it when they leave.
Things change…..not sure if your noticed but inflation and interest rates are rising.
That's not the tenants fault if you haven't fixed the mortgage rate.
I've been in the house that I rent for 8 years. No rent rises in that time. The flat that I own and rent out hasn't had a rent increase since the current tenants moved in 4 years ago. My costs haven't increased so why would I charge more?
@footflaps that’s a valid point. Re-reading the quote above, I suspect it’s based on weekly rental rather than monthly. I will increase the term accordingly.
As a landlord, having a tenant stay ages is great, reduces maintenance and costs associated with re-letting eg deep clean / new carpets etc. As a flip side, happy to not rock the boat by upping the rent whilst they're there.
We had the same tenant in for 19 years and I think we raised the rent twice in that period.
The rent doubled when they moved out - we wont be making that mistake again.
I have a couple of mates who rent houses out and they both say the same about raising rent...
A good tenant is worth way more than an annual rent rise.
Only asked one about this, and he still has a clause in the contract about reviewing the rent annually. It is worth having even if you don't intend to use it. Fixed mortgage deals come to an end, the cost of maintaining the house can change, and you never want to be making an actual loss on a house.
That’s not the tenants fault if you haven’t fixed the mortgage rate.
I’ve been in the house that I rent for 8 years. No rent rises in that time. The flat that I own and rent out hasn’t had a rent increase since the current tenants moved in 4 years ago. My costs haven’t increased so why would I charge more?
Even with a fixed mortgage his costs will still go up. His insurance, the cost of replacing the boiler, fixing the roof, whatever. These will all be more
Fixed mortgage deals come to an end, the cost of maintaining the house can change, and you never want to be making an actual loss on a house.
I know what you mean - and certainly it's possible for a small landlord to find their mortgage repayments are more than the rent, which is undesirable and could require them to tighten their own belts - but it's still not 'making a loss'. It just means you're not getting your extra house completely paid for by others, but may need to put some money in yourself.
And even then, 20 years down the road the mortgage will be buttons and if you're still charging market rent you'll be absolutely coining it. It will easily cover those couple of years where you were £150 a month out of pocket. So again, you wouldn't have made a loss.
Things change…..not sure if your noticed but inflation and interest rates are rising.
not sure if your noticed but these things affect tenants too! They're not exactly sitting pretty with free electricity and bargain petrol either.
I'm not anti-landlords per-se. I was a renter for 17 years, had good landlords and crap ones. But I am against the idea that a) all profit must be maximised at all times and b) all the risk for the landlord's venture should be offloaded onto the tenant. Especially because the average tenant is less wealthy than the average landlord, so it doesn't seem massively fair to soak the tenants.
Section 24 is now causing landlords to sell up on mass. I'd expect average tents to be rapidly increasing for the few properties that are left.
Whilst I'm happy to keep my tenant for a long period, there comes a point where you need to make a little money to keep up with the maintainance.
We have had the same tenants in our rental flat for 5 years.
Not only have we not raised the rent, but in fact have just dropped it by £50 per month as it has all electric heating (no mains gas) which we know is t the cheapest thing in the world to run.
There's no reason for your rental prices to go up in line with inflation. As the single biggest monthly expense for most people, that serves to do nothing but drive inflation harder.
Secondly, you should have considered the affordability of your mortgage repayments with higher interest rates and planned on how to cover it yourself, not palm the problem off to your tenants.
Basically you want to insulate yourself from increasing expenses while exploiting someone else's need for housing, and that is why have-a-go landlords are despised.
Secondly, you should have considered the affordability of your mortgage repayments with higher interest rates and planned on how to cover it yourself,
Ah so by your logic he should have just set a higher price to start with ....
It's not charity ffs.
See also...
not sure if your noticed but these things affect tenants too! They’re not exactly sitting pretty with free electricity and bargain petrol either.
So your landlord should subsidise your expenses also....*
*Not a landlord
Doesn't need index linked but anyone not at least factoring in the option for a periodic rent review in the current climate is either Charging too much from the off or leaving them self wide open
@flaperon Nice big brush there 🙄
Lots of factors are changing, some external, some directly from our.gov.
For the shrinking minority who want to remain landlords, keeping up with inflation is needed.
Landlord reality
My tenant pays £650/month. Every flat in the development pays £80 to a factor which covers insurance, fixing the roof etc. That cost might have gone up a fiver or so in the last 6 years. I also pay £23 to a property maintenance company who do the gas/electricity/legiinella etc inspections as well as covering all the labour for internal repairs. There has been no price increase in 4 years.
Even if all of my costs go up by 10% this year, it's an extra tenner a month.
I'm not going to piss off my tenant by passing that on to them. I can afford it more than they can.
Your first responsibility as a landlord is to provide a safe, comfortable home for your tenants with a degree of financial security, not to screw every possible penny out of them to pay for your next ebike. A few more landlords could do with remembering that.
Your first responsibility as a landlord is to provide a safe, comfortable home for your tenants with a degree of financial security, not to screw every possible penny out of them to pay for your next ebike. A few more landlords could do with remembering that.
Yep.
I always think how would I feel if our roles were reversed?
There has been no price increase in 4 years
Really, what about your tax?
I am in the same mindset as you, but my tax bill is significantly different. If your rent doesn't cover your costs, there needs to be a mechanism to increase rent.
If I were a Tennant I would be bracing myself for bumpy times. We've just experienced the lack of rentals ourself with my sister in law. She was evicted as landlords sell up and unscrupulous landlords will be waiting.....
That clip is pretty accurate imo.
Ah so by your logic he should have just set a higher price to start with ….
Basically, yes. Mortgage rates going up from historic lows is not something inconceivable at the time of taking out the loan.
I doubt anyone on a tracker mortgage passed on the saving when interest rates fell.
Ignoring all the landlord bashing in this thread, what happens if the tenants don't agree with the rise? Are you going to offer them a break clause at the same time? Seems to me that a 6 or 12 month contract might just be simpler.
Worth pointing out that some lenders dont like long contracts for tenants. I know sounds odd right! I presume they value the ability to free up a property without a tenant over a fixed income over three years. We fell foul of this and ended up with a poor deal on our btl mortgage.
It’s not all down to money grabbing slum landlords!
We rent out 3 houses. They all have 60% mortgages, they are occupied by young families and they're really nice places to live. We charge a bit less than market rates and we don't put the rent up. We keep on top of repairs and even replace carpets etc. if they wear out through fair wear and tear. The tenants think we're good landlords, we have no problems with them. It makes us feel good, we're making good money on the rent and we're doing pretty well on the increase in property prices.
Yes, the mortgage companies say they don't like rental contracts in excess of 12 months, but who's going to tell them?
For balance it is Worth remembering there are some pretty bad tenants out there too!
Some of the things I hear from a friend who develops and rents out HMO’s in Weston Super Mare would surprise most people. He is filling a huge demand in social housing and quite frankly I can’t see why he does it!
My landlord is lovely. My tenants have told me I'm a star. They appreciated the hamper I sent them at Christmas as well.
law is in favour of tenants and they mostly know it.
It really.not especially in England. Tenants have very few rights
Certainly over the last few years the clauses brought in due to covid have massively changed the balance in favour of bad tenants. It has been virtually impossible to get people out if they are breaching lease terms. In one example I am familiar with running a brothel!
You do not have security of tenure. Thats massivly in favour of landlords
You do not have security of tenure. Thats massivly in favour of landlords
While I agree, my experience was that I've only ever kicked one tenant out (via court after 6 months of no rent paid) and the rest all seemed happy to move on as job location changed, new partner was met, or they saved enough to buy thier own place. I personally would have preferred they stay.
I'll maintain that there's a need for flexibility for many - and many landlords do provide stability and a good home.
As someone that's been on both sides - as a Landlord I would ensure any contract included the ability to increase the rent with x weeks/months notice and as a Tenant I'd be negotiating when it was asked for.
The DTs. Your friend does HMO's as you make far more money than renting houses to families. Not a criticism just a fact.
It would need to based on the hassle it causes him. People sub-letting on Air BnB, drug dealing and prostitution... Not to mention the constant damage due to vandalism and stupidity. On top of all that there is the permanent arrears of certain tenants and the inability to get them out (Less so now rules have gone back to pre covid)
There's been a bit of thread cleansing going on here.
One particularly nasty comment calling me scum (and my light-hearted response) has been deleted.
I'd like it put back so everybody can point and jeer at the poster for either their ill-judged attempt at humour or their sheer nastiness (delete as appropriate).
@BigJohn Good point! I had tried to ignore some of the digs/insults based on massive (and incorrect) assumptions about my situation, but I remember the post you are referring to and it has gone! I guess it was reported and deleted by the MODS, in which case thanks to whoever reported it and to the MODS
Yep DT it causes more headaches I agree, landlords, myself included are in it to make money so you take the good with the bad.