How big a rent increase is fair?

catkins

Been renting quite a few years. Landlord has not done anything to house since me and OH have been here nor when previous tenants were here (about 18 years in total). We have done quite a lot of work to keep the house looking decent inside but the outside is looking bad now.

Anyway the landlord didn't put up the rent because he knew we were spending our money on the property. Then in 2015 he put the rent up by £150 a month. We were not happy about such a large increase but as we wanted to stay in the house we accepted it.

Last week he told us he wants the rent to go up from 1st June by £200 a month. When we said we were not happy with this he said it would then match the going rent for property in our area.

Ok this would be true BUT he chose not to put the rent up for so many years and the rent fell behind the going rate. We have spent our time and money decorating every room, putting in new carpets or laminate and various other things.

We told him we cannot just find another £200 a month but he won't budge.

We are going to have to look to move to a cheaper area but are furious with landlord. How does he think we can conjure up another £200 a month? I wouldn't mind but he doesn't declare that he is renting the house out and insists on being paid cash so it is all tax free money going in his pocket

[Deleted User]

catkins wrote: »

How does he think we can conjure up another £200 a month?

He may not think you will. But he may know someone that can.

Cliveman_Pieman

That is the market rent. If the price of petrol goes up to ridiculous levels you can't just choose to pay less unfortunately. If you won't pay it, someone else will.


In future, never spend your money on someone else's house, it's just not worth it.

Pixie5740

That was your choice to [STRIKE]waste[/STRIKE] spend money decorating and laying new flooring. I never did that when I was renting. If you wanted that to be taken into account when determining the rent you should have got something in writing.

Assuming this is in England or Wales see G_M's guide to Rent Increases: How and when rent can be increased in an AST.

saajan_12

catkins wrote: »

Been renting quite a few years. Landlord has not done anything to house since me and OH have been here nor when previous tenants were here (about 18 years in total). We have done quite a lot of work to keep the house looking decent inside but the outside is looking bad now.- ok, that's up to you, you didn't have to do work. If there was actual repair issues, you could have asked the LL to address these (via Shelter's process if necessary.

Anyway the landlord didn't put up the rent because he knew we were spending our money on the property. Then in 2015 he put the rent up by £150 a month. We were not happy about such a large increase but as we wanted to stay in the house we accepted it. - fine, its a negotiation. Sounds like the house / convenience of staying put was worth the increase - perfectly fair.

Last week he told us he wants the rent to go up from 1st June by £200 a month. When we said we were not happy with this he said it would then match the going rent for property in our area.

Ok this would be true BUT he chose not to put the rent up for so many years and the rent fell behind the going rate. We have spent our time and money decorating every room, putting in new carpets or laminate and various other things.

We told him we cannot just find another £200 a month but he won't budge. - lucky you haven't had to find another £50/100 all this time if there had been more gradual increases.

We are going to have to look to move to a cheaper area but are furious with landlord. How does he think we can conjure up another £200 a month? - he may not think you can, but if someone can find it for that property, why wouldn't he ask you to match or rent to them? I wouldn't mind but he doesn't declare that he is renting the house out and insists on being paid cash so it is all tax free money going in his pocket- that's another issue and not really relevant as you're paying the same as long as you're getting rent receipts.

The key is in bold: it's fair to expect the LL will charge market rent. If until now the rent was below market rent, you have been given a benefit all this time as it is. I understand its a shock but if it had gradually increased in line with market, the new rent would have been the same £200 more than before, just you would have paid more in the interim.

Cliveman_Pieman

Also, contact HMRC if he is evading tax


https://www.gov.uk/government/organisations/hm-revenue-customs/contact/reporting-tax-evasion

mattyprice4004

As above, if he's let you have it below market for quite some time I guess you've done well.
If you can't afford the going rate for the area, you'll have to move to a cheaper area. I had to do the same, it sucks but it's gotta be done.

Good luck with it all.

Crashy_Time

https://www.lettingagenttoday.co.uk/breaking-news/2017/5/small-scale-btl-investors-waking-up-to-tax-change-says-trade-group


Move somewhere cheaper and let the landlord discover if market forces are on his side or not?


https://www.lettingagenttoday.co.uk/breaking-news/2017/5/small-scale-btl-investors-waking-up-to-tax-change-says-trade-group

Gilead

A LL needs to make a return on their investment - with the new BTL legislation has probably caused him to assess levels of rent. You have a had this place below market value for some time - therefore he has not been greedy, or was happy with it just ticking along.

You were unwise to do so much investing in the place beyond a lick of paint or gloss.

Be grateful you have had it for so long at a more than reasonable price - either pay the increase or move on.

Crashy_Time

You could also make sure that there are three or four cheaper properties that you could rent, point it out to him, and haggle a bit? Unless he is sure he won`t have a void I think he is being a bit ambitious with the raise, he sounds a little desperate TBH.

kimplus8

I have made a similar mistake in the past- I decorated and made the house look better, then I was given notice so the landlady to let to her daughter.
Now I would never again decorate a house that isn't mine. Its not worth it and is a complete waste of time and money that will benefit your landlords pocket.
chalk it all up to experience and move on (or out as in your case). or accept the £200 increase and move on.
just out of interest, how long have you lived in the property? just because a £350 increase may seem a lot but if that is over say 15/16 years then its not that much really when you taking into account how much everything has gone up over that length of time.
hope this helps :-)