25% rent increase - is it normal?

Kkml1961

Dear All,

I currently reside in London and pay £1,150 per month for my one-bedroom flat. Due to ongoing health issues, I am presently receiving benefits.

My landlord has informed me that he will be issuing a new tenancy agreement with an increased rent of £1,426, which he claims aligns with the Local Housing Allowance. His assumption seems to be that my benefits should cover the entirety of this amount as it is the maximum allowance.

However, I am concerned that I would be unable to afford this rent increase should I return to work in the future. I have spoken with my neighbours and friends, and was expecting an increase of £50 to £100 per month at most.

Could you please advise me on what steps I should take? Am I within my rights to refuse this increase or attempt to negotiate the new amount?

Thank you in advance for your guidance.

RHemmings

The most important thing is whether the new rent is considered to be the market rent for that sort of property, or not. If the new rent is extortionate, then perhaps you can challenge it. If you previously had an unusually cheap rent and it is moving to a normal rent, then it's harder to challenge. 

Certainly you are well within your rights to negotiate with your landlord. And, that's probably a reasonable first step. 

How does the new rent compare to other similar properties in your area? 

Grumpy_chap

How long has your rent been at £1,150?
How does the proposed rent compare with the market rent for the area?
Once you have those points, you can assess the best way to respond / negotiate.

Mr.Generous

What does your tenancy agreement say about increases? Does it specify percentages and timing of any increases - they usually do.

You can decline a new tenancy and stay on the old - it just becomes a rolling tenancy.

However ... so many landlords are selling up due to changes in law that are coming, rents are - and will continue - to jump. The anti landlord sentiment from politicians is going to drive out a few, the high mortgage rates have done the same. If you rock the boat your landlord may try and evict, section21 no fault is still allowed. It only needs a very small reduction in the number of landlords to drive rents up, tenant numbersd are still increasing year on year.

I would look at local rental market, than negotiate. If local rents are higher than yours don't mention it - just focus on what a good tenant you are, pay on time, look after the property etc - If local rents are lower or the same mention it!!

sourpuss2021

It sounds like you’ve got a good landlord!  Rents in London have shot up since Covid and are now vastly higher than LHA rates.  

Your 1-bed flat might fetch £1700 or £1800 tomorrow if it was listed on OpenRent.  So if he’s only increasing it to the LHA rate then he’s doing you a favour.   

The unfortunate reality may still be that you face being priced out of London, which is a tale as old as time.

From the perspective of a London landlord, tenants are interchangeable.  There’s always someone new who’ll pay the market rate.

I guess you are on Universal Credit rather than Housing Benefit (which has been closed to new claims for 5-6 years).  And so you’ll find because of the benefit cap, there won’t be enough to pay bills and living expenses together with an inner London LHA level rent.   Are you also receiving PIP?

Would your landlord allow you to take in a lodger in the lounge (or the spare room, if there is one)?

Do you have family that you could move back in with, if the worst happens and you’re squeezed out of the property? 

theartfullodger

Mr.Generous said:

.....

You can decline a new tenancy and stay on the old - it just becomes a rolling tenancy.

....

Exactly.....

BonaDea

I'm in London.  Near me, in a very average inner London area, is a 1-bed flat (with a tiny handkerchief of garden) up for rent at over £2600 pcm.  

sourpuss2021

On the positive side, here are 100+ examples of 1-bed flats and studios inside zone 2, priced under £1500pm:

https://www.rightmove.co.uk/property-to-rent/find.html?locationIdentifier=REGION%5E93814&maxBedrooms=1&minBedrooms=0&maxPrice=1500&minPrice=1100&sortType=1&propertyTypes=flat&maxDaysSinceAdded=14&mustHave=&dontShow=houseShare%2Cretirement%2Cstudent&furnishTypes=&keywords=

sourpuss2021

Previous thread:

https://forums.moneysavingexpert.com/discussion/6547148/help-contract-renewal-and-rent-increase