Increasing Rent: The Right Way

Rent increases are normal, but they must be done correctly. Here's how to increase rent without breaking the law or losing good tenants.

When Can You Increase Rent?

- After fixed term ends (if no rent review clause)

- During fixed term (only if agreement includes rent review clause)

- Usually once per year is considered reasonable

How Much Can You Increase?

There's no legal limit, but:

- Must be "fair and realistic"

- Should reflect market rates

- Tenant can challenge if unreasonable

The Process:

For Periodic Tenancies:

1. Check your tenancy agreement

2. Research local market rates

3. Give proper notice (minimum 1 month)

4. Use Section 13 notice if no agreement clause

5. Put it in writing

For Fixed Term:

- Can only increase if rent review clause exists

- Follow procedure in agreement

- Usually requires mutual agreement

Notice Periods:

- Monthly tenancy: 1 month notice

- Yearly tenancy: 6 months notice

- Check your agreement for specific terms

Section 13 Notice:

Use Form 4 for statutory periodic tenancies:

- States new rent amount

- States date increase takes effect

- Must give proper notice period

Communicating the Increase:

Good approach:

"Dear [Tenant], I hope you're well. I'm writing to let you know that from [date], the rent will increase to [amount]. This brings it in line with similar properties in the area. I've attached market research for your reference. Please let me know if you'd like to discuss this."

Bad approach:

"Rent is going up. Pay the new amount or leave."

If Tenant Objects:

- Listen to their concerns

- Be prepared to negotiate

- Show market research

- Consider their payment history

- Good tenants are valuable

Tenant Can Challenge:

- Apply to tribunal within 1 month

- Tribunal will set "market rent"

- You must accept tribunal decision

Top Tips:

✓ Give more notice than required

✓ Explain the reason

✓ Provide market evidence

✓ Be reasonable with amount

✓ Consider tenant's circumstances

✓ Keep increases annual, not more frequent

Common Mistakes:

❌ Increasing too frequently

❌ Unreasonable amounts

❌ Not giving proper notice

❌ Verbal agreements only

❌ Retaliatory increases

Remember: Good tenants who pay on time and look after your property are worth keeping. A small rent increase is better than void periods and re-letting costs.