Rent increase from next month!

Charl36

Initially put on Coronavirus forum but advised to put on here too.

Hi all, hoping someone with wisdom can help 
we got served notice two months ago as our landlady fell out with the management agents and we would have been out of the property on the 18th of this month but due to lockdown this will now not happen! The landlady initially asked us to move in with friends but of course that’s not possible so is now putting up the rent by £50 a month and says as we will be coming out of contract there is nothing we can do about it! We received a ‘landlords notice for rent increase’ letter today. We are not going to pay it, we are not here by choice we are just following guidelines and with estate agents not showing properties there is literally nothing we can do about it. We are still okay to pay the rent as it was but just wondered if she can take try and take it out of our deposit when we can finally move or if there is advice anyone can give us it would be welcome. She is only upping it to get us out but I just don’t understand how she doesn’t get it we can’t go anywhere! It feels unfair especially during these times.
Many thanks all.

Slithery

The LL serving notice doesn't mean that you have to leave the property, only you or the courts are legally able to end the tenancy.

As to the rent increase, please read...

RENT INCREASES: when & how can rent be increased?

A) Mutual agreement; b) During the fixed term; C) at the end of the fixed term; D) During a SPT; E) During a CPT
(note the following applies in England and Wales)

A) MUTUAL AGREEMENT
Rent can be raised or lowered at any time, irrespective of the type of tenancy (Fixed Term or Periodic) provided both landlord and tenant agree.

Normally such agreement should be in writing, but note that if, for example, the LL proposes a new rent, and the tenant starts to pay it, then by implication the tenant has accepted (agreed to) the new rent.

B] DURING THE FIXED TERM
In a Fixed Term tenancy of 12 months or less, it is unusual for there to be any clause allowing the rent to be changed during that FT. However there may be, so read the tenancy agreement.

In a Fixed Term tenancy of over 12 months (eg 2 years) it is common for there to be a clause allowing the rent to be increased, normally after the initial 12 months. Again, read the tenancy agreement.

If there is no such clause, then the rent cannot be increased during the fixed term (except as above by mutual agreement).

Any clause allowing a rent increase must be unambiguous both i) as to when (eg at the end of the first 6 months) and ii) by how much ie :

· a cash amount (eg from £500 pm to £540 pm)
· a percentage (eg 3%)
· an amount linked to a recognised index eg the CPI/RPI (Consumer/Retail Price Index)

If the wording of the clause is vague, or makes it unclear/ambiguous as to when or how much the increase will be, the clause is invalid. A tenant cannot be presented with a rent increase that was not expected. A vague "The landlord will review the rent after 12 months" is not clear enough to be legally meaningful.

Note that where a variable amount is specified ie the RPI, the index from 2 months preceding the increase should be specified. This allows the landlord time to calculate the exact amount of the new rent, and send it to the tenant a month before it comes into effect. If the index from the same month as the date of the increase is used, the tenant would have no clear advance notice of the precise amount of the increase, so could not be made to pay it.

C) AT THE END OF THE FIXED TERM
Often a landlord (or his agent) will offer a new Fixed Term contract. This can be at a new rent, and can be for any amount they wish. However, the tenant is under no obligation to agree. His options are:
agree and sign the new FT contract at the new rent or
negotiate and agree a different amount, and sign this amended FT contract or
move to a Statutory Periodic Tenancy (see this post here) at the same rent as before
Find a cheaper property and move out. No notice is required by the tenant at the end of the FT.
However, be aware that if a tenant moves to a SPT their security is reduced and the landlord can serve a S21 Notice (1st step to ending the tenancy) eg if he thinks he can get a better paying tenant (and believes the higher rent will offset the costs of eviction, loss of rent during the void period, and new tenant-find).

D) DURING A STATUTORY PERIODIC TENANCY
Statutory Periodic Tenancies follow on automatically at the end of a Fixed Term.

This is always the case unless "the tenant is entitled, by virtue of the grant of another tenancy, to possession of the same or substantially the same dwelling-house". This would normally be by signing a new fixed term contract, or because the original contract made provision for a subsequent Contractual Periodic Tenancy (see below).

The rent in a SPT, and all other terms, are initially exactly as during the preceding Fixed Term.

Other than mutual consent (above), the rent can be changed in one of two ways:

1) If there is a clause in the original tenancy agreement specifying how and when the rent can be increased, the landlord can change the rent in accordance with that clause. As explained above, this must be clear, both as to when and by how much.

Example: a Fixed Term tenancy of 6 months has a clause stating that at each anniversary of the start of the tenancy, the rent may be increased by 3%. At the end of the initial 6 months, the tenancy becomes a SPT, still at the original rent. 6 months later (ie 12 months from the start of the original tenancy) the rent can be increased by 3%.

The tenant must be given advance written notice of this, usually of a full Tenancy Period. This is usually a month though precise dates are important - see this post for explanation of 'Tenancy Period' (annual or weekly tenancies have different notice periods).

2) whether or not there is a clause (as 1 above), the landlord can serve a Section 13 Notice (see links below). The rent can be increased by any amount, but as above, the S13 increase cannot take effect until (usually) a full Tenancy Period has passed. A S13 Notice must be in the prescribed form. A casual email, or conversation, is not a substitute (unless the tenant agrees - see 'mutual consent' above).

E) DURING A CONTRACTUAL PERIODIC TENANCY

1) If there is a clause in the original tenancy agreement specifying how and when the rent can be increased, the landlord can change the rent in accordance with that clause. As explained above, this must be clear, both as to when and by how much.

2) if there's no rent clause, the landlord can serve a Section 13 Notice (see links below). The rent can be increased by any amount. Note that a S13 Notice cannot be used in a CPT if there is a rent clause in the contract


A S13 Notice can be challenged by a tenant, and referred to the Rent Assessment Committee, which may confirm the new rent, reduce it, or increase it, in line with local market rents. But note also that as the tenancy is periodic, if the landlord is unhappy with the RAC's ruling (or indeed, unhappy with the tenant choosing to refer the rent to the RAC) he may simply give the tenant (S21) notice to end the tenancy (see below).


REFERENCES

Housing Act 1988 section 13

Section 13 Notice

Rent Assessment Committee Referral (appeal against a S13 Notice rent increase)

London District Properties Management Ltd v Goolamy [2009] EWHC 1367 (2009) (S13 Notice can be used even where a SPT contains a rent review clause, but not where a CPT contains a rent review clause)

Written demands (for rent etc: LL's actual address needed) Beitov Properties Ltd v Martin

greatcrested

Assuming you have a tenancy (not lodger sharing with landlord), rent cannot just be increased .

You are not 'coming out of contract'. If your fixed term is ending, you are moving to a periodic tenancy and your contract continues on that basis, month by month.

If your swere served a S21 Notice expiring 18th April, that also does not end the contract. It just means that after the 18th the landlord can, if he wishes, apply to a court to end the contract.Only a court can end it. If you stay, and the LL does not get a court possession order, the contract continues.... at the same rent.

As for the rent increase, read the post above.

Be warned though, the moment you start paying the new rent you will be legally assumed to have agreed to it, and then it becomes binding. You cannot later challenge it!

Charl36

greatcrested said:

Assuming you have a tenancy (not lodger sharing with landlord), rent cannot just be increased .

You are not 'coming out of contract'. If your fixed term is ending, you are moving to a periodic tenancy and your contract continues on that basis, month by month.

If your swere served a S21 Notice expiring 18th April, that also does not end the contract. It just means that after the 18th the landlord can, if he wishes, apply to a court to end the contract.Only a court can end it. If you stay, and the LL does not get a court possession order, the contract continues.... at the same rent.

As for the rent increase, read the post above.

Be warned though, the moment you start paying the new rent you will be legally assumed to have agreed to it, and then it becomes binding. You cannot later challenge it!

Thanks so much for your response, much appreciated. We are tenants not lodgers, she gave us two months notice at 4 months so we would be out at 6 months as she wanted the house back.  We have been fine about it as that’s life and would have been gone but the times we are living in makes that impossible for us at the minute.  We would have thought she would understand that but she clearly doesn’t care. Thanks again,

Charl36

Slithery said:

The LL serving notice doesn't mean that you have to leave the property, only you or the courts are legally able to end the tenancy.

As to the rent increase, please read...

RENT INCREASES: when & how can rent be increased?

A) Mutual agreement; b) During the fixed term; C) at the end of the fixed term; D) During a SPT; E) During a CPT
(note the following applies in England and Wales)

A) MUTUAL AGREEMENT
Rent can be raised or lowered at any time, irrespective of the type of tenancy (Fixed Term or Periodic) provided both landlord and tenant agree.

Normally such agreement should be in writing, but note that if, for example, the LL proposes a new rent, and the tenant starts to pay it, then by implication the tenant has accepted (agreed to) the new rent.

B] DURING THE FIXED TERM
In a Fixed Term tenancy of 12 months or less, it is unusual for there to be any clause allowing the rent to be changed during that FT. However there may be, so read the tenancy agreement.

In a Fixed Term tenancy of over 12 months (eg 2 years) it is common for there to be a clause allowing the rent to be increased, normally after the initial 12 months. Again, read the tenancy agreement.

If there is no such clause, then the rent cannot be increased during the fixed term (except as above by mutual agreement).

Any clause allowing a rent increase must be unambiguous both i) as to when (eg at the end of the first 6 months) and ii) by how much ie :

· a cash amount (eg from £500 pm to £540 pm)
· a percentage (eg 3%)
· an amount linked to a recognised index eg the CPI/RPI (Consumer/Retail Price Index)

If the wording of the clause is vague, or makes it unclear/ambiguous as to when or how much the increase will be, the clause is invalid. A tenant cannot be presented with a rent increase that was not expected. A vague "The landlord will review the rent after 12 months" is not clear enough to be legally meaningful.

Note that where a variable amount is specified ie the RPI, the index from 2 months preceding the increase should be specified. This allows the landlord time to calculate the exact amount of the new rent, and send it to the tenant a month before it comes into effect. If the index from the same month as the date of the increase is used, the tenant would have no clear advance notice of the precise amount of the increase, so could not be made to pay it.

C) AT THE END OF THE FIXED TERM
Often a landlord (or his agent) will offer a new Fixed Term contract. This can be at a new rent, and can be for any amount they wish. However, the tenant is under no obligation to agree. His options are:
agree and sign the new FT contract at the new rent or
negotiate and agree a different amount, and sign this amended FT contract or
move to a Statutory Periodic Tenancy (see this post here) at the same rent as before
Find a cheaper property and move out. No notice is required by the tenant at the end of the FT.
However, be aware that if a tenant moves to a SPT their security is reduced and the landlord can serve a S21 Notice (1st step to ending the tenancy) eg if he thinks he can get a better paying tenant (and believes the higher rent will offset the costs of eviction, loss of rent during the void period, and new tenant-find).

D) DURING A STATUTORY PERIODIC TENANCY
Statutory Periodic Tenancies follow on automatically at the end of a Fixed Term.

This is always the case unless "the tenant is entitled, by virtue of the grant of another tenancy, to possession of the same or substantially the same dwelling-house". This would normally be by signing a new fixed term contract, or because the original contract made provision for a subsequent Contractual Periodic Tenancy (see below).

The rent in a SPT, and all other terms, are initially exactly as during the preceding Fixed Term.

Other than mutual consent (above), the rent can be changed in one of two ways:

1) If there is a clause in the original tenancy agreement specifying how and when the rent can be increased, the landlord can change the rent in accordance with that clause. As explained above, this must be clear, both as to when and by how much.

Example: a Fixed Term tenancy of 6 months has a clause stating that at each anniversary of the start of the tenancy, the rent may be increased by 3%. At the end of the initial 6 months, the tenancy becomes a SPT, still at the original rent. 6 months later (ie 12 months from the start of the original tenancy) the rent can be increased by 3%.

The tenant must be given advance written notice of this, usually of a full Tenancy Period. This is usually a month though precise dates are important - see this post for explanation of 'Tenancy Period' (annual or weekly tenancies have different notice periods).

2) whether or not there is a clause (as 1 above), the landlord can serve a Section 13 Notice (see links below). The rent can be increased by any amount, but as above, the S13 increase cannot take effect until (usually) a full Tenancy Period has passed. A S13 Notice must be in the prescribed form. A casual email, or conversation, is not a substitute (unless the tenant agrees - see 'mutual consent' above).

E) DURING A CONTRACTUAL PERIODIC TENANCY

1) If there is a clause in the original tenancy agreement specifying how and when the rent can be increased, the landlord can change the rent in accordance with that clause. As explained above, this must be clear, both as to when and by how much.

2) if there's no rent clause, the landlord can serve a Section 13 Notice (see links below). The rent can be increased by any amount. Note that a S13 Notice cannot be used in a CPT if there is a rent clause in the contract


A S13 Notice can be challenged by a tenant, and referred to the Rent Assessment Committee, which may confirm the new rent, reduce it, or increase it, in line with local market rents. But note also that as the tenancy is periodic, if the landlord is unhappy with the RAC's ruling (or indeed, unhappy with the tenant choosing to refer the rent to the RAC) he may simply give the tenant (S21) notice to end the tenancy (see below).


REFERENCES

Housing Act 1988 section 13

Section 13 Notice

Rent Assessment Committee Referral (appeal against a S13 Notice rent increase)

London District Properties Management Ltd v Goolamy [2009] EWHC 1367 (2009) (S13 Notice can be used even where a SPT contains a rent review clause, but not where a CPT contains a rent review clause)

Written demands (for rent etc: LL's actual address needed) Beitov Properties Ltd v Martin

Thank you for all that information, I will have a good read through, it’s much appreciated.

greatcrested

Charl36 said:

greatcrested said:

Assuming you have a tenancy (not lodger sharing with landlord), rent cannot just be increased .

You are not 'coming out of contract'. If your fixed term is ending, you are moving to a periodic tenancy and your contract continues on that basis, month by month.

If your swere served a S21 Notice expiring 18th April, that also does not end the contract. It just means that after the 18th the landlord can, if he wishes, apply to a court to end the contract.Only a court can end it. If you stay, and the LL does not get a court possession order, the contract continues.... at the same rent.

As for the rent increase, read the post above.

Be warned though, the moment you start paying the new rent you will be legally assumed to have agreed to it, and then it becomes binding. You cannot later challenge it!

Thanks so much for your response, much appreciated. We are tenants not lodgers, she gave us two months notice at 4 months so we would be out at 6 months as she wanted the house back.  We have been fine about it as that’s life and would have been gone but the times we are living in makes that impossible for us at the minute.  We would have thought she would understand that but she clearly doesn’t care. Thanks again,

Was the '2 months notice'in the form of a S21 Notice (Form 6a)?

* if no, it is meaningless

* if yes, then as already explained, you do not have to 'be out' after 2 months.

Only a court can make you leave.

macman

She can't take any money out of your deposit as it will have been protected (please tell us it is protected) and is not held by her. No protection means any S21 is invalid, and you can sue for up to 3 times the deposit value.

Charl36

macman said:

She can't take any money out of your deposit as it will have been protected (please tell us it is protected) and is not held by her. No protection means any S21 is invalid, and you can sue for up to 3 times the deposit value.

Thank you, yes the money is protected with the TDS.

Charl36

greatcrested said:

Charl36 said:

greatcrested said:

Assuming you have a tenancy (not lodger sharing with landlord), rent cannot just be increased .

You are not 'coming out of contract'. If your fixed term is ending, you are moving to a periodic tenancy and your contract continues on that basis, month by month.

If your swere served a S21 Notice expiring 18th April, that also does not end the contract. It just means that after the 18th the landlord can, if he wishes, apply to a court to end the contract.Only a court can end it. If you stay, and the LL does not get a court possession order, the contract continues.... at the same rent.

As for the rent increase, read the post above.

Be warned though, the moment you start paying the new rent you will be legally assumed to have agreed to it, and then it becomes binding. You cannot later challenge it!

Thanks so much for your response, much appreciated. We are tenants not lodgers, she gave us two months notice at 4 months so we would be out at 6 months as she wanted the house back.  We have been fine about it as that’s life and would have been gone but the times we are living in makes that impossible for us at the minute.  We would have thought she would understand that but she clearly doesn’t care. Thanks again,

Was the '2 months notice'in the form of 

* if no, it is meaningless

* if yes, then as already explained, you do not have to 'be out' after 2 months.

Only a court can make you leave.

Yes the 2 months notice was in the form of a S21 notice form.

wesleyad

Out of interest why does her falling out with the agent have any affect on your tenancy? Seems strange she wants paying tenants out at this point in the crisis. 

Charl36

wesleyad said:

Out of interest why does her falling out with the agent have any affect on your tenancy? Seems strange she wants paying tenants out at this point in the crisis. 

She had originally wanted to sell the house but refused to come down in price so then thought renting was better, we moved in and 3 weeks later the house needed a new boiler and it was a bit of a fight to get one as she said it worked fine when she tried it! ( it was October, I had just had my son and she thought we could last a good while without one) the agents manage the property and she didn’t like them pushing her for the go ahead to install a new one and then she decided renting wasn’t for her and is refusing to deal with the agents ever since.. we are just caught in the middle but I wish we had known she wasn’t bothered about renting before we moved in as we wanted to stay a while. I guess she clearly doesn’t need the rental income.