Rent increase of 5%

blunt_crayon

Hi all, hoping for some advice.

Just heard from our letting agency re: renewing our tenancy that they want to increase our rent by 5% (inflation + 1%). We are in London and rents have gone up in the past year but it's already super expensive and the upper end of our budget (£650pcm each excluding bills x3). Is a 5% increase reasonable? Should we try to negotiate? I can find places on Rightmove that are similar and cost the same/less although we'd prefer not to move if we can avoid it.

Thanks in advance!

BitterAndTwisted

A 5% increase may not be unreasonable. You need to find compelling evidence that your rent is comparable to what other properties are currently being rented at and an increase is therefore not justified. Or vote with your feet.

If you wanted to be really vengeful, you could decide to give your notice and tell the agent/landlord that you will not allow any viewings whatsoever until you vacate. Then, the landlord will have a void until they can secure new tenants. This should wipe out any possible increase in rent by several multipliers. You might consider offering this possible scenario to the agent as part of your negotiations.

westlondonbuyer

BitterAndTwisted wrote: »

If you wanted to be really vengeful, you could decide to give your notice and tell the agent/landlord that you will not allow any viewings whatsoever until you vacate. Then, the landlord will have a void until they can secure new tenants. This should wipe out any possible increase in rent by several multipliers. You might consider offering this possible scenario to the agent as part of your negotiations.

If you decide to take up this option, do figure in the cost of moving (for all of you) into your calculations. Also the costs of new credit searches and fees with a new letting agent, and the likelihood that your current landlord might refuse to provide a reference for your future landlord, thus losing your new place (and usually your holding deposit into the bargain).

A rent increase is just a business transaction. Do you know what normally works best in business transactions? Pick up the phone, be nice, have a chat, find a compromise that works for all the parties concerned. I'd be surprised if you couldn't negotiate the increase down or even cancel it altogether (especially if the letting agent has advised it, not the landlord insisted upon it).

Although, FWIW, many landlords don't increase rents when they have good tenants. It may be that your landlord actually wants to get rid of you, perhaps because he wants to sell or upgrade the property.

blunt_crayon

Thanks for the comments. I think I'll call the letting agent tomorrow. It sounds like the landlord has suggested the rent increase but he could just be saying that - I wouldn't be surprised if he was just trying it on. I don't think they want to get rid of us as we are model tenants - 3 professional women, very clean and tidy, rent always paid on time etc etc. So hopefully this will go in our favour as I get the impression the previous tenants were a bit of a nightmare.

FTBFun

I reckon you should try and negotiate, especially as you've been good tenants.

The inflation is a bit of a misnomer, as its not making much difference to the landlords' costs I suspect, apart from maybe insurance costs and service charges. Its actually slowly eroding his debt, and given current interest rates I suspect the mortgage is being serviced fairly cheaply.

prudryden

Sounds OK for this year. I read somewhere that London rental rates have gone up more than that this year.

blunt_crayon

prudryden wrote: »

I read somewhere that London rental rates have gone up more than that this year.

Probably true, shame our salaries haven't increased by the same amount

westlondonbuyer

blunt_crayon wrote: »

I wouldn't be surprised if he was just trying it on. I don't think they want to get rid of us as we are model tenants - 3 professional women, very clean and tidy, rent always paid on time etc etc. So hopefully this will go in our favour as I get the impression the previous tenants were a bit of a nightmare.

I agree that the letting agent may be trying it on - they get a percentage of the rent usually, not a flat fee, so it's in their interests to re-negotiate, particularly if they think you've put down roots and are unlikely to move.

Unfortunately if your landlord wants to sell or upgrade, being model tenants is neither here nor there

climbgirl

Definitely try and negotiate (don't threaten them!). We had a proposed increase this year of around 4% but managed to get them to hold the rent as it is when we negotiated. We stressed that we're long-term tenants, look after the property, things like that.

The agent tried to tell us the landlord had more costs to cover and was proposing the increase herself but when we spoke directly to her it turns out the agents pushed her incredibly hard to increase by a lot more than that originally! Frankly, I tend to question everything they tell us.