Recommended approach for notifying a tenant about an upcoming rent increase?

what is a reasonable increase?
if i were a tenant i think i would like this % based increase to be supplied by a recognizable property organisation. ie NRLA. Create a new data index with monthly increases or deceases (similarly to the RPI ). ideally to be kept as simple as possible, but meaningful.

Have a read of this
https://www.pims.co.uk/how-to-increase-the-rent/

Hi Neel
Be prepared for push back whatever you do. Under a similar AST which rolled on after 6 months I notified my tenants verbally (during inspection) and in writing if they still in situ after 12 months there would be a rent increase. They replied in agreement with this. I applied a £50 increase (very much in line with current properties in the area) after 14 months and all hell broke loose in terms of suddenly loads of jobs needed attention (all superficial things) plus submission to rent tribunal as an unfair increase (which was overturned) but stressful all the same. They vacated just before xmas so I had 7 week void during a time you really could do without your property being empty. All this for a £50 increase (which I never actually enforced) so my advice is think very hard about your increase and possible repercussions if they good tenants (ie pay current rent on time and look after the property).

Reply to the comment left by RoseD at 09/05/2023 - 11:27
It is precisely that seven week void period speaks to my primary concern with the prospective changes, compulsory rolling contracts are grossly unfair to landlords as the can, as you found be dumped at difficult times of year; we used to house a lot of Saudi students and many would ask fo rten month tenancies, simply not viable.

It depends, there are a few ways and it really depends on you and your tenants relationship, I either send an email or a letter, in my time as a private LL, never has a tenant refused or demanded to appeal etc, but then my rents are very fair indeed

Reply to the comment left by Chris H at 09/05/2023 - 13:10
Here is my standard template which you can edit...

I hope are both enjoying living at xyz rd for the past 18 months so I just thought I would 'check in' with you in well in advance about your rental plans again as your rental contract will end on 31st October this year. As I am sure you are aware the rents in London have been increasing by >10% last year. I will be increasing the rent by 10% so the new rental contract amount will be £A,BCD per calendar month starting 1st November 2023 ending 31st October 2024 for a 12 month fixed-term tenancy agreement.

This will be just under the trend of rents increasing in locally (13% increase year on year). I know some Landlords are now deciding to sell their properties but just to confirm I have no plans to sell so it will remain a rental property in the future (medium term). Please do confirm if you plan to renew at this rate and I will draw up all the relevant paperwork that needs resigning again in good time.

I perfectly understand if this is too much and you would like time to look around for cheaper accommodation (hence the advance notice), if that is what suits your financial circumstances. You may well decide that XYZ RD does not offer you the rental value for money and I would be sorry to lose you as tenants should you decide not to re-sign a new contract but I do have to balance my business needs.

If you do find something that is financially a better option for your accommodation needs, then you just need to give me one month's notice you plan to vacate, at any time, within the current contract period. Either way do let me know soon so we can both plan ahead.

Kind regards,

Below are some of the latest guides for the national and local rental market

https://www.goodlord.co/newsagent/goodlord-rental-index#rent

Goodlord Rental Index | Goodlord

DPS Rent Index Q4 2022 Regional Summaries (depositprotection.com)

https://www.depositprotection.com/news-insights/dps-rent-index-q4-2022-regional-summaries

Rent prices: How much have they gone up in your area? - BBC News

https://www.bbc.co.uk/news/business-65103937

If you're still in the fixed-term and you charged a market rent then it shouldn't be too far below market rate already, so for a good tenant I usually wouldn't increase at all.

For good tenants the cost of redecoration, repairs & void is far more than a small gain. I keep the rent below current market rate. If I do increase, I research similar properties on Rightmove to find the market rate, and send them a list to show even with the increase the new rent still compares favourably. If they move out and I lose a good tenant, then I'll market at the new market rent to offset the void loss.

Choose your moment to raise it and how - meeting them in person will give you an opportunity to answer their concern immediately.

Reply to the comment left by Crouchender at 09/05/2023 - 13:50
Hi,
Very kind, I am not at the momet in any fixed term contracts but will keep this in mind, in my letters I also advised them of the rental market and their right of appeal

A housing association increased rents by 200 per month. Then suggested that if they didn't want to accept the increase they could leave and then they would kindly not hold them to the notice period!

Reply to the comment left by RoseD at 09/05/2023 - 11:27
Frankly - in the long run you are probably better off (wellbeing wise) without them.