Should I increase the rent?

@Everywheretwice what happens if the boiler needs replacing? Etc don't have enough in reserve to replace it? Do you have enough in reserve to change the bathroom or kitchen if it needs replacing. There are a few adults living there so the wear and tear might be heavier than normal.

Don't think of the increase as you being greedy. Costs have gone up and if your tenants are reasonable they'll understand.

Good luck with whatever you decide to do.

I have been in a similar situation to you, we like the tenant and didn’t want to upset the apple cart. But, with increases in insurance, ground rent and Section 24 changes that mean I pay 40% tax on rent means I’m making a loss every year. I’m now selling the house, and our lovely tenant will have to find an extra £300pm to live in a similar property.

You definitely have to raise the rent, you should really have been doing it by a small amount each year. With 3 working adults I think £100-£150 increase would be reasonable, surely they must be expecting it.

Being a landlord is not a charity and I can never understand why some people think it's so awful that tenants are paying someone else's mortgage. It's a business at the end of the day and without private landlords there would be a great deal more homeless people!

I think it would be entirely reasonable to raise it by £100 this year and same again this year. At this point the tenants know they have been lucky at six tumultuous years with no increase. You have been more than fair.

Again, they’ve had years of paying under market rate and have 3 adults working full time in the house.

I’m sure you do things I feel are wrong.

It's a business, you're entitled to make a reasonable profit. Increase the rent.

If it’s a business then raise the rent, https://england.shelter.org.uk/housing_advice/private_renting/rent_increases

id suggest emailing and suggesting £75-100 increase. Then next year increase by £50, the following year by £50.

id always keep rent increasing in very small amounts but keep rent below market value for a good tenant, it’s a balancing act

I'm a tenant. If you need to raise the rent, the kindest thing would be to raise it by say, £50 pm at the next suitable point and then again the following year, and so forth. If you raise it by a sizable amount in one go, your tenants may need to move out quickly and that will be a problem for both parties.

@Everywheretwice my mortgage went up £1000 a month , you can absolutely raise the rent to £950. That’s life at the moment for everyone, you are not a charity. I think that’s way below the increase you’d expect over 6 years!

Joined for this: I’ve lived in my house for 8 years and my rent has increased £25 in that time. I look after the house and she gets paid on time every month. I pay very far below market value but I’m a good and reliable person. She has not kept up her side of some of the things at all. But I rent a 4 bed house with a drive and garden for £600 a month? I cause her no isssue. Don’t increase it.

Last time I looked private renting wasn’t an investment scheme 🤣 what a ridiculous comment!

Op, if you do decide to raise the rent and you manage the property yourself make sure you do it properly using section 13 and give at least a month's notice.

No increase in 6 years is unfair to you.

BUT, a big increase now to catch up is unfair to your tenants.

You should have made smaller increases every year.

However, given Covid, the COLC, etc., I can see why you didn't as it's been a bad time.

But you need to start now. I'd suggest an increase to £850 now. Then £900 in a years' time, then £50 per year looking forward until it matches reasonable market rent. Just tell them you held any increase back because of Covid and COL, but that you can't carry on at an undervalue.

They can afford an extra £50 per month per year, but probably couldn't afford a jump of £300 in one go and it would be unfair to put them in that position, especially seeing as it is partly your fault by not increasing by smaller amounts on a yearly basis.

If they're good tenants and you want to err on the side of kindness I would split the difference between market rate and what they're paying now and increase it by that. Obviously give them notice of the change. My mum is a landlady and was a bit soft with her previous tenants, they took the pots and pans with them that were on the inventory to leave behind when they left, meaning my mum had to shell out £200+ for more, plus missed a number of monthly payments whilst there.
If they are good tenants by all means increase the rent but keep it below the market value as a gesture of goodwill, but it is also a professional service.

Small incremental rent increases are more palatable than a sudden shift. My parents were the same as you. They rented out my grandmother’s house to help with her care costs when she moved in with them. They didn’t raise the rent for 10 years. It was already below market rate when the family moved in, as the tenants offered to do general household maintenance in return for a substantial discount. They haven’t looked after it as well as annticipated and now my parents are stuck with expensive repairs they can’t afford, in part because the rent is now half the market rate. They also feel unnecessarily duty-bound to the tenants because they have been there for a long time and wouldn’t find anything else for the same rent they pay now. It’s such a mess and never would have been if they had charged enough rent to cover future maintenance and raised the rent a small amount each year.

@FollowTheMusic The lack of house building means housing is now scarce asset and so the increase in market rent is far outstripping the increase in average salaries. Most people who are renting have no choice because they can't afford to buy. Rent increases come directly out of already tight family budgets. If you want to profiteer from a housing market that is on fire then you're fully within your rights to but I couldn't look myself in the mirror personally.

£950 is far too much. That's a lot more than inflation.

Op I gave my tenants a small rental increase of 5% to cover the increased costs of insurance and mortgage. etc. On a £800 rent I'd increase to £840 or you may want to go £850.

From experience it's better to do small annual or every other year increments rather than a massive £150 increase to recoup what you could have earned.

Not keeping abreast of current rents is not your tenants problem and they shouldn't have to suffer. I'm speaking as a landlord here, see username.

Someone has to pay the increasing costs. So the landlord's family should go without to cover another family?

I don’t think increasing costs should be passed on to tenants who often can’t afford to save for a deposit for their own house due to paying someone else’s mortgage.

OP isn’t running a charity. There are 3 adults working full time in the house and they’ve had lots of time paying under market rate.

They’re your tenants, not your friends. Not raising the rent for 6 years, especially of your costs aren’t covered, is crazy.

Charge market rate and be a good landlord. I’d increase to market rate over the next couple of years.

What increasing costs are there? Is it actually hurting you financially? A young family who is renting is unlikely to have a spare couple of hundred quid lying around every month. That could be the difference between them going on holiday this year or not.