Rent Increase

AlanB1979

(Had originally posted this in the wrong forum, was advised to post it here)

Apologies in advance, its a bit of a long one...

So myself and 4 housemates rent a house in North London. Its an annual tenancy.
Our current tenancy is finishing in 9 days, end of April.

We got notice today from the agent that the landlord intends to increase the rent as part of the new tenancy. He does not know by how much only that the landlord intends to increase the rent.

What are our options here? How much notice must be given for a rent increase for an annual tenancy considering the tenancy is due to finish next week and we would like to stay on in the house. Also should we be given notice that they intend to renew the tenancy?

If we do not agree to the increase what can they do? If they ask us to vacate the property then what is the required procedure they must follow? I heard about a section 21 and two months notice, can anyone elaborate on this?

Also a couple of the girls called into the agency a couple of weeks ago as we had a new tenant move in and there was no mention of rent increase and he made no attempt to discuss renewing tenancy despite it only being a few weeks away.

Lastly one of the house-mates decided to move out recently(leaving end of April), we advertised the room at the current cost however this is likely to increase now.
We offered the room to someone last night and they accepted. We now have to tell them about the increase. If they decide not to take the room because of this then what are our options as we don't feel we should cover the cost of the extra room between the rest of us (assuming we cant get anyone to take it over)

Any help greatly appreciated!

A

AndyBSG

Assuming you are on an Assured Shorthold Tenancy I would guess your tenancy had a fixed rental period of 12 months(possibly with a 6 month break clause).

That means that when your tenancy ends on the 9th April then you will simply move onto a periodic tenancy. That means you carry on living there on a one month rolling contract paying the same rent you're paying now.

Of course, if you do that and refuse a rent increase then the landlord can evict you by serving an S21 so you'll be able to stay there a couple months or longer on your existing rent but you will then need to move once the eviction process is complete.

I would consider a few things before getting to that point though.

- If you want to stay in the property regardless of the rent increase, then you obviously don't want to get to that point.

- If you have to find somewhere new then the associated removal costs, tenancy reference costs etc may well end up costing more than the rent increase.

- Rises in rent at the end of tenancy are pretty much a fact of life. Even if you do move out and find somewhere else you can guarantee the rent will increase there as well.

- There's nothing wrong with negotiating. If your paying 700 a month and the LL wants to increase it to 800 then offering 750 may see them agree. Most LL's would much rather stick with existing tenants who they know look after the property, pay rent on time and are generally hassle free than gamble on new tenants for just 600 a year extra... Of course, it all depends on how much your current rent reflects market rate. If you're paying 700 and other comparable properties in the same area are going for 1000 then you've got no chance of negotiating.

AndyBSG

Lots of info on ending an AST and what's involved here which will show exactly what to expect if you refuse the rent increase.

http://forums.moneysavingexpert.com/showpost.php?p=67759913&postcount=4

AlanB1979

Thanks for the replies, much appreciated!

Has anyone any info on the notice given for the rent increase? Surely a week is not good enough? I read somewhere it should be six months but I am not too sure about this?

Any ideas?

thanks again

Chrysalis

Andy's answer is a bit scary, is it really common to get a rent increase every single year? it makes my one increase in 13 years seem a miracle.

I dont know the answer to the question should there be a minimum notice, but I expect if the notice is after the end of the current tenancy its probably legal, but I am only guessing.

Sadly landlord's will be well aware that if a tenant moves out to avoid the increase they have to assess if they saving money as the cost of moving is not cheap, and I expect because of this most tenants will agree to rent increases. This is something you also need to decide, you realistically seem to have 3 options.

1 - stay where you are and accept the rent increase (try negotiating first tho, you are unlikely to get a s21 for just trying to negotiate).
2 - Dont agree to the increase in which case you move to a periodic tenancy, the landlord possibly will decide not to evict you, and as such you save money, but there is a risk of eviction which will come in the form of a s21 notice. Which I think is a 2 month period.
3 - Move, and look for somewhere else, but unless the new property is significantly cheaper any financial gain is likely going to be from small to nothing.

Miss_Samantha

Chrysalis wrote: »

2 - Dont agree to the increase in which case you move to a periodic tenancy, the landlord possibly will decide not to evict you, and as such you save money, but there is a risk of eviction which will come in the form of a s21 notice. Which I think is a 2 month period.

In such case the landlord will just serve a formal s.13 notice to increase the rent and AlanB1979 will have to pay.

Chrysalis

thanks for this information.

private renting in this country is so heavily weighted in landlord's favour.

although whats the difference between issuing a s13 or saying pay more rent and then issuing a s21 if tenant refuses? the s13 seems pointless.

GipsyHillClimber

I had quite a similar situation around this time last year for the house i'm renting in South London. About a week before the contract was due for renewal we were contacted by the letting agency informing us the rent would be increasing by £75 PCM. I had only been there a year and quite liked the place so was more willing to accept the increase than have to pay all the associated costs of moving, along with the general hassle of moving. As others have said i thought i'd try my luck at negotiating with them, i thought of myself as a very clean, tidy and respectful tenant and knowing that a lot of landlords prefer a known quantity i thought i may have a good chance.

I sent an email to the letting agent explaining that i didn't see the justification for the rent increase after only a year, citing local house prices actually dropping slightly and rental prices generally staying the same. I said i would be happy to enter conversations the following year and that i understood rent doesn't stay the same regardless. My hope was that they would just come back asking for £30 extra a month which i'd settle with but they came back and said they were happy to not increase the rent. As a positive they also haven't increased the rent this year!

So quite a long reply but i would say that you should try sending a well written email explaining the mitigating circumstances you've mentioned above (new tenant, short notice), check local price trends and use them if they're in your favour and see how it goes. If they do come back and say they'll be increasing the rent regardless you can then make your mind up if you want to give your notice or stay and just hope your new tenant doesn't decide to pull out!

AlanB1979

Hi Folks,

Apologies about the delay in getting back here. Firstly thanks for all the advice!

Just to update my housemate took it upon herself to agree to the increase on behalf of everyone. She reckoned that because she had a majority vote (I was the only one against it, preferring to wait to discuss our options before replying to agent) that she could just agree with increase. Needless to say this has caused serious tension in the house but what can you do eh? So it looks like a £50 increase each per month!

thanks again for the advice!

Miss_Samantha

This assumes that the agreement of a single joint-tenant is enough to increase the rent under the tenancy.

blu3sky

Sounds like it's been resolved now, but I would really recommend phoning Shelter for advice on rented housing issues. They offer free advice from trained housing advisors and have really helped me out in the past!