To raise their rent every year?

[Fev11]

For various reasons I have recently started renting out a house and plan to keep doing this for a long time. The tenants have said they plan to stay for at least 10+ years if possible.

What is reasonable as far as future rents are concerned? If they were only planning to stay for e.g. 2 years, I would probably keep the rent the same, but 10 years is a long time so my gut feeling is to put something in place where it rises each year in line with inflation.

The tenants are great but I suppose I am doing this on a business footing. For any long-term renters and landlords out there, what do you do, or think is fair?

You would still do a yearly contract, so each year you would have that option to increase. Not sure how it works where you are but in Ireland you're only allowed to increase by certain amount every year

We’ve finally bought a house but before that rented a flat for 5 years, another flat for 5 years then a house for 3 years. I don’t know if we were just lucky but our rent never increased while we were in each property.

We never routinely raise the rents especially when they are good tenants. Some are on a lower than market rent and they know that. We change the rents when they leave for new tenants. If you are a good landlord and the rent is lower they are more likely to stay. Every time you make a rent increase in my experience they are de stabilised and start looking at comparative properties. If we really have to raise it we let them know the year before and make it as small an increase as possible, But generally no, reward your good tenants and keep them happy. If you do ever increase, do it properly with the right paperwork and keep it legal

I wouldn't tbh, but then I make a good profit on my rental property so I would rather have good, long-term tenants than try to squeeze a bit extra out. I think I'd be a bit put off by somewhere where the rent rose every year, personally. It seems quite mercenary, for presumably the sake of a few quid, if it's just in line with inflation. If something happens and you need to increase the rent in the future for whatever reason, then just do it then.

Also in UK we never do a new contract once the first period has elapsed as legally it becomes a periodic contract with the same terms. Agencies are on to a money spinner renewing. Be the best landlord you can be and make renting a home a positive experience. It is more important now it is so hard to raise a deposit for a first home

We have rented the same property for 6 years now, our landlord hasnt raised the rent once, we are very thankfull and we are good tenants! We are here until we can buy a house ourselfs, but we have 0 savings at the moment so we will be here a long time

You negotiate a rent change as appropriate to the market conditions at various times, rent is pretty stagnant in many areas, certainly the idea that there's any sort of expected increase is very dubious. Certainly we've reduced our rent during some years we've been here, market conditions are what matter.

You almost certainly do not want to do anything but an AST, so any agreement about what happens far in the future is pointless. If you do choose to increase the rent in the future during a periodic tenancy, remember the cost of the void when they move elsewhere will eat an awful lot of extra few quid a month.

No!
Good tenants can be hard to come by.
You will want to keep them surely so don't repay them by putting rent up every year. Trust me they will go elsewhere.

Well, you can tell them (in plenty of time before they are due to renew) the rent for the next year is going to be £X amount and they can decide whether they want to pay that or leave. It depends how much you want to keep the same tenants in the house or whether you’re happy to risk having to re let it every year and have void periods.

That all sounds pretty unanimous then!
To be fair, they're great tenants and they are very happy with us as landlords so I guess we'll just keep it the same rather than rock the boat. The contract side should be easier too as we can just roll over to a periodic tenancy once the initial term is up.

The way I look at it, raising it by inflation would be 10 or 20 quid a month. If your tenants didn't like it and decided to move then you run the risk of having it empty for a month and would negate your profit from rent raise, and then some. Good tenants are worth their weight in gold.

Christ! Let’s hope their work is giving them pay rises in line with inflation too then! Is that what you get at your work too op?

I’ve lived in my house for 5.5 years now, have fortunately never had an increase In rent in that time- I’d probably have to move if I did.

FWIW ive been renting for 15 years and never had a rent increase in any of the 4 properties. I’ve been in this house 10 months and if the rent increases in April I’ll leave.

In UK you have a paragraph which states you can review rent yearly (but not necessarily increase) by x per cent (there are restrictions) it means that if your expenses increase you can increase rent that year but as others have said if you have good tenant you should review whether its worth the extra cost if they move to get new & possibly irresponsible tenant instead.

We rented a flat for over 5 years and the rent didn't increase at all during that time. We were good tenants and looked after the flat well. If the rent increased yearly we'd have left, it's a renters market where we were based and there's always another flat/house.

I had a landlord that raised the rent every 6 months, I was a good tenant never late with rent etc, he was an awful landlord 🙄 eventually I couldn’t afford to live there, he raised the rent again quite a bit after I left then had to lower it as nobody took it on. That was satisfying

I'm in Wales. I have my properties managed by an agent. My rents follow the trends locally rather than by inflation. My rents have remained the same in one house and gone down by £15 per month in another. I'd rather have happy, long term tenants.

I’m literally not making a penny on one of mine, just paying the mortgage and insurance. If the insurance goes up then obviously that’ll need to be covered but other than that I’m happy for the mortgage to just be cleared

I wouldn’t personally if they are good tenants as they are hard to come by at times it seems - I have heard some real horror stories of some renters. If they were to walk away from the rental then you would have a void period which you need to consider if it’s worth it for the sake of £20 a month

We rent, were good tenants and have been here 4 years and plan on being here for probably at least another 4. We have never been late for rent, unless its something serious like a boiler needing replaced we are happy to do repairs (with our landlords knowledge and permission) keep the house in good decorative order, garden is kept tidy etc. We are aware we pay below local market rent but weve had 2 rent increases in the time weve been here, first time was £25 a month taking us from £780 to £800 which we were fine with but weve just gone from £800 to £850 and that extra £50 has really caused us financial difficulties and made us consider moving.

If you have good tenants id say keep the rent as it is or raise it nominally every couple of years but not yearly and not by a massive amount.

I haven't raised the rent on my rental in nearly 4 years and don't intend to this year.
I have a decent tenant who pays the rent and looks after the house and is settled there.

My agents always push me to increase the rent, but I don't increase for existing tenants - especially since when you have tenants, as a rule, you only fix things that break, you don't do any re-decoration etc. I usually do that between tenants.

while real inflation is over 4%, the fabricated official figure is much less than that. Unless you are in 'charge what you like' London, it isn't worth it as if you go over the local rate they will leave and you'll have a void which will cost you much more.

outside London there ARE rent controls, called market forces.

I highly doubt you will want to be in the business in 10 years, or indeed in about 3 years given the upcoming law changes.

A good tenant is worth their weight in gold. I wouldn't be taken for a ride, but nor would I seek to gain the maximum amount I could. Raise the rent every year? No.

We never put the rent up while tenants are in - if we like them. Ours stay on average about four years so it works out well with redecorating, replacing old white goods etc.