Acceptable rental increase?

Collapse
X
  • Filter
  • Time
  • Show
Clear All
new posts

    Acceptable rental increase?

    Hello, we are loking for some advice raising the rent on our 3 be Flat.

    We need to raise our rent to cover our mortgage hike (just about to fall off the end of our initial 2 yr fixed deal!), we have never raised our rent before and so don't know what an acceptable percentage rise would be.

    We need to raise the rent by circa 8% pcm to cover our out goings (raising the monthly rent by £130 on a 3 bed flat in London) does this sound acceptable? If anyone could give us a steer on this we would appreciate it.

    Cheers

    #2
    You can only base it on what is the going rate, otherwise you may loose your tenants...and that would be even worse than not quite having enough to cover the mortgage.
    All posts in good faith, but do not rely on them

    * * * * * ** * * * * * * * * * * * *

    You can search the forums here:

    Comment


      #3
      Originally posted by Mark&Sam View Post
      Hello, we are loking for some advice raising the rent on our 3 be Flat.

      We need to raise our rent to cover our mortgage hike (just about to fall off the end of our initial 2 yr fixed deal!), we have never raised our rent before and so don't know what an acceptable percentage rise would be.

      We need to raise the rent by circa 8% pcm to cover our out goings (raising the monthly rent by £130 on a 3 bed flat in London) does this sound acceptable? If anyone could give us a steer on this we would appreciate it.

      Cheers
      Two ways to implement increase:
      A. Keep existing AST going but serve Notice under s.13 of Housing Act 1988 (assuming that AST does not itself contain a rent increase mechanism). This has the advantage of not triggering DPS requirements.
      B. Terminate existing AST (s.21) but immediately grant new AST at increased rent.
      JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
      1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
      2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
      3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
      4. *- Contact info: click on my name (blue-highlight link).

      Comment


        #4
        You could look on rightmove or whatever the best London sites are for advertising rentals to see what the current asking rents are for properties in you area, bearing in mind how many are available, how long they've been advertised (which you get to notice after looking for a while) and bearing in mind that achieved rents are usually a bit below asking rents. Then consider what it would cost you if your tenant leaves.

        Thing is every landlord has a different sized mortgage, it may be smaller if for example they purchased ages ago, so rents aren't set based on your costs but by the market as a whole and by what tenants can pay or they can just move somewhere cheaper.

        An 8% rise sounds a lot to me but I am not on London.
        ~~~~~

        Comment


          #5
          Your mortgage doesn't drive the cost of your rent, the local market does

          So rather than looking at what you need to raise by, you need to look at what equivalent properties on the local market are going for

          Who knows, you might even need to drop the rent for your next tenants if you're above the market rate

          Comment


            #6
            8% is a pretty steep rise to expect your tenants to accept. I know if my landlord were looking to increase my rent by that much I'd probably say "thanks but no thanks ... I'll move" unless I had already been getting the place for a ridiculously cheap amount

            I think if you try and raise by such a large amount you'll be looking for new tenants (and end up getting the associated costs)

            Just out of interest ... would you pass on a reduction in rent if your costs went down or would you continue to expect your tenants to pay the market rate?

            Comment


              #7
              Originally posted by Mark&Sam View Post
              Hello, we are loking for some advice raising the rent on our 3 be Flat.

              We need to raise our rent to cover our mortgage hike (just about to fall off the end of our initial 2 yr fixed deal!), we have never raised our rent before and so don't know what an acceptable percentage rise would be.

              We need to raise the rent by circa 8% pcm to cover our out goings (raising the monthly rent by £130 on a 3 bed flat in London) does this sound acceptable? If anyone could give us a steer on this we would appreciate it.

              Cheers
              Why don't you just remortgage to a better deal (I assume that you are about to go to the Lender's SVR (Standard variable rate) Which in most cases is 7.5% +. There are some decent deals about at the moment on 2 year fixes at 5.35% for Buy to lets. (If my assumption is wrong then please disregard).

              Regards

              Jai

              Comment


                #8
                Some London rentals have apprently gone up by 30% in the last year alone.
                The contents of this note are neither advice nor a definitive answer. If you plan to rely on this, you should pay somebody for proper advice.

                Comment


                  #9
                  I trawled round SW London rental agents this Spring & asking prices for rents have shot up - as posted here some 20% or so v 2006. I am v happy with my current tenant so increased the rent by RPI - c 4% from memory - & he accepted without question.

                  My rents probably a bit low but I am happy & he pays for the contract in advance. The real money is in the capital appreciation anyway (20% 2006 - 7) v the yield c 4%. Don´t be greedy....

                  Cheers all

                  Comment


                    #10
                    The real money is in the capital appreciation anyway (20% 2006 - 7) v the yield c 4%. Don´t be greedy....
                    One of these days you will get in a mess. Don't say I didn't warn you... Oh yes, if you put the rent up by 25% - which you probably could, at least, then your yield would be 5% or more.
                    The contents of this note are neither advice nor a definitive answer. If you plan to rely on this, you should pay somebody for proper advice.

                    Comment

                    Latest Activity

                    Collapse

                    • Deposit not Protected
                      prm70115
                      Hi there,

                      I have recently found out the the agent (working for the landlord) has not protected my deposit paid Summer 2017 for a 6 month tenancy. The tenancy is up in 2 weeks and I have been asked if I want to renew which I would like to do as I wish to stay in the property.

                      ...
                      15-01-2018, 11:42 AM
                    • Reply to Deposit not Protected
                      KTC
                      They are still liable for a penalty of between 1x and 3x the amount of the deposit for not having protected the deposit for the original 6 months fixed term tenancy, but you'll have to sue them for it obviously. When the time comes, they can if they wish serve you valid section 21 notice unlike before...
                      24-01-2018, 11:18 AM
                    • Reply to Deposit not Protected
                      prm70115
                      An update which has confused me:

                      Having renewed the tenancy for another year (as I wanted the security of tenure), I received confirmation that the deposit (paid 6 months ago for the initial 6 month AST) has now been protected. I have confirmation from all the deposit protection schemes,...
                      24-01-2018, 11:03 AM
                    • Attending Court - Advice Please
                      Muzza
                      Hi there

                      I posted recently about our tenant leaving and giving her ex the keys to our house, we have a court date of 4th January for which Im flying back to the UK to attend (no contact or rent received from the persons she has left in there still). I feel hes staying in there as long...
                      12-12-2017, 18:03 PM
                    • Reply to Attending Court - Advice Please
                      Hillsy101
                      Oh I'm such a pillock - there's also a great sticky on this in this forum! - https://forums.landlordzone.co.uk/fo...cement-options...
                      24-01-2018, 10:34 AM
                    • Leak into downstairs flat - advice
                      Dberry
                      Hi,

                      I'm new the forum and the UK and wonder if you can advise…
                      I’ve recently moved to the UK from Canada and so I’m not sure of rights and liabilities... I moved into my flat a few months ago and caused a leak into the apartment below me by leaving the tap running in the bathroom...
                      23-01-2018, 08:50 AM
                    • Reply to Leak into downstairs flat - advice
                      Dberry
                      It turns out that there was a leak coming from the roof that caused the problem. It just so happened to be on the same day. However the sink will still be fixed which is good news.
                      24-01-2018, 09:35 AM
                    • Part Admission of Debt MCOL Help!
                      nessa
                      Hi, hoping someone can help.

                      First claim on mcol, so I’m finding my feet.

                      I have just received forms n9a and n9b from the court, regarding the defendants part admission to my claim started in mcol.

                      However that was all I have received, I received no other forms...
                      24-01-2018, 06:15 AM
                    • Reply to Part Admission of Debt MCOL Help!
                      Interlaken
                      Yes you should have received other forms for guidance and to make a reply.
                      Phone them - be prepared for long wait or try 1st thing and tell them what you have received.
                      24-01-2018, 09:23 AM
                    • Expired Smoke Alarms
                      Maria Pelling
                      I recently had a heating engineer undertake a Gas Safety Inspection at a property I own. The GSI was fine but in the fault details he has written that the smoke alarms have expired. Looking at them they were fitted when the property was built in October 2007 and they say they are valid for 10 years....
                      23-01-2018, 15:57 PM
                    Working...
                    X