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?

We have been in 2 private let properties in the past, for 4.5 years altogether - 2 years in one, 2.5 in the other, and the rent went up every year in both properties.

Our first private let house was £575 a month rent, and at the end of the year he put it up to £625. Then at the end of the second year he sold it so we had to find somewhere else.

So we found another 3 bed house. For £600 a month.

Annoyingly, the property agent said (when we moved into the second property,) that the rent is £600 a month, and it shouldn't go up because she didn't raise the previous tenant's rent in the 4 years he was there.

Fast forward a year, and she put it up to £635 a month. Then the following year £675 a month! Almost a 15% rise in 2 years. Our wages didn't go up that much though! So when the third year came along, she put it up to £700, and there were other properties that were £100 to £125 a month cheaper, with the same amount of bedrooms, and in a similar area.

She was taking the piss, so we refused to sign the tenancy agreement, and let it fall into a month-by-month tenancy (it has a name but I can't remember it!)

It means you can leave whenever you want and are only obliged to give one month's notice, but the landlord can get you out in only 2 months. We said we didn't wanna sign for another year, as we were getting high up on the social housing list (we had been on it for 4 years.)

We really looked after that house, put new carpets in 2 bedrooms, put curtain poles up, painted 3 or 4 rooms that were jaded and a bit shoddy, and paid our rent a week early every month.

When things went wrong (like a hole in the garage roof, and a blown down fence, or a broken drainpipe or blocked guttering,) she kept saying she can't afford to repair it as the rent only just covers the mortgage on the place!

She kept saying 'I don't make anything on this you know; I barely break even! We thought 'yeah not our fault though is it?' DH ended up doing the repairs himself!

So anyway, the rent stayed at £675 a month, but the property agent said if we have not moved/been accepted for social housing within 3 or 4 months, we will have to sign the new £700 a month contract, or she will ask us to leave. We bid furiously on every suitable 'social housing' property for 4 months, and eventually me and DH got offered a little social housing property... £350 a month. Half of what she was charging.

This landlady who tried to put our rent up to £700 a month (for the third year in,) tried to re-let our house. Ironically, the house stood empty for 5 months, losing her £3500 in rental income. It was a bit of a rough area, but we knew a few people from there, and our kids were friends with a few kids from there, so we were quite happy there, and our neighbours were lovely.

Yeah we would eventually have left as we did want the security of social housing eventually, but if she had kept the rent the same as it was when we first moved there, we would not have been bidding on so many properties, and may have stayed another 2 or 3 years. (And may possibly have given her more notice/warning to leave than the one month...)

Forgot to say my tenants haven't had a rent increase in over four years.

I rented for years and the landlords always increased rent with inflation. Sometimes they would keep it the same if we signed a new 12 month contract. For example it would go from 695>725 or 750>765.
In ten years the rent for other properties will increase, if you're renting it out for 700 now it'll be worth more in that stretch of time

My tenants have been in for three years and I couldn't have hoped for better. I gave them a 50% refund for December, and will do for every year they stay. I wouldn't change their payments, wages generally don't go up that much these days.

I used to rent and had my rent increased each year, over 12 years it increased by nearly 50% but it was still slightly under market value.

My partner owns a house that he rents out and his current tenant has been there about 7 years and never had a rent increase. We don’t really have any increased costs as it is mortgage free and the tenant is excellent so we don’t want to rock the boat. This is their home and we don’t want them to have any uncertainty. If they leave then the next tenant will pay the current market rate.

Not a tenant or a landlord but have always said if I was to be a landlord I would not charge much above local market levels and not increase if it covered my costs and the upkeep of the property.

I'd also try to keep in as close to local housing allowance if possible so that tenants who may fall on hard times could get their rent covered through UC/HB and would guarantee rent payments coming to me.

I have social conscience though so probably not the best mindset to be a landlord.

I think valuing good tenants is key. Saying that if they were tenants who didn't look after the place, late payers etc I wouldn't think twice about increasing with the hope of pricing them out.

Maybe not so socially conscious after all 🤔

I have social conscience though so probably not the best mindset to be a landlord.

oh dear, do put the Guardian down. Landlording is not a 'social enterprise' it is a business. Once you get the first trashing of a fully refurbed property it is quite a struggle to maintain the energy to make it all lovely again. You'll learn if you ever go into it.

I have social conscience though so probably not the best mindset to be a landlord.

The husband of the family who rents from us fell sick. They needed to claim benefits to help with the rent. It took the Council 10 months! to process their claim correctly. We could have evicted them for non payment as they were months behind. Instead we accepted partial rent whilst the council faffed around. There isn’t enough social housing provision in London for people who want to rent long term so private landlords are picking up the slack. Bear in mind that if we had evicted them the council would have classed them as intentionally homeless through non-payment of rent.
The council can mess up payments to the point someone is evicted and then blame the individual for that eviction: who has the social conscience?

@ChazsBrilliantAttitude An apt user name.
The council in the UK is horrendous, how do they expect a landlord to wait on the payment. Mine goes up 4% every year, ITV's a prime location, at least 200 a month cheaper, though I rarely call my landlord out if I can sort it I will, like that if I need amything he supplies it.
Social consciousness aside a landlord is allowing a stranger in their most expensive asset. It is a give and take relationship, it always works better built on mutual respect.

It is not ITV.

My previous flat I rented for 5 years never had a rent increase. My current place I've been a for 7 years and plan to stay for another 3-4 years. Rent has never gone up here either.

The country is struggling with rising prices across the board and incomes are down in real terms. If you keep putting the rent up don't be surprised if they struggle to afford it and have to leave earlier than planned.

@buttonmoonb4tea - your "social conscience" doesn't rise to you charging at or below market rates, according to your post however - this is what you said:
"have always said if I was to be a landlord I would not charge much above local market levels"

MY social conscience appears to be in better nick than yours, given that my tenants are paying about £250 BELOW market rate in rent.

I wouldn't. In those years the house will start to look shabby. If you had new tenants every year then you'd have to get it repainted etc... At least with a long term tenant you won't have to neaten the property constantly.

Like others have said, your tenant will think about leaving if you keep raising the rent. They'd probably think they could get a fresh new place for the same rent instead of your tired one.

@ThumbWitchesAbroad to be honest a probably would charge at market level. That's usually in line with local housing allowance rates and as I said that's what I would charge. Of course this is all hypothetical, but I like to think I'd be fair.

And good for you for charging so much below market rates. You're tenants are quite privileged to have a landlord who is not purely driven by profit.

@buttonmoonb4tea Not sure how you'd get on charging above market rent. Who on earth would pay over the going rate??

My friends own a BTL. They keep an eye on local rents, but would rather have decent tenants who report issues, keep the place clean and tidy and pay on time. Their current ones are nice to neighbors, do small repairs themselves and generally are a dream. They haven't raised their rent in years.

They gave an example of someone they knew who raised the rent regularly until his nice tenants moved out. Then not so nice tenants moved in. They ended up being evicted after a lot of hassle and money and the house was trashed - they did take tenant to court and got a payment plan of £5 a week.

Lived in my last flat for 5 years and the LL raised the rent every year but refused things like adding extra cupboards in the kitchen (even though they’re relatively cheap). We were good tenants but moved out as our mortgage for a 2 bed house was nearly £100 cheaper than our rent.

I knew there would be some posts about how horrible landlords are, it never dissapoints! OP I wouldn't as standard, but I would but a caveat in the contract that states that you can annually review an increase; as you say 10 years is a long time.

Totally agree with NoMorePoliticsPlease much cheaper than clearing up after a bad tenant.

We rented for well over 10 years and have never had an annual rent increase. First year in a shared ownership property and the housing association increase the rent by £100 per year. If this keeps happening we'll be worse off than when we rented! Their reason for this increase is based on property value going up. We can't afford to staircase by purchasing more shares so we're basically fucked!

I never increase rent during a tenancy but do so in between after refurbishment in line with the local market.

Current tenants have been here 3 years. I probably would if tenants stayed long enough it was time for changing carpets and redecorating.

We've been in our flat almost 3 years, and every year we have a £50p/m increase. I wouldn't have minded too much had the landlords not replaced the washer dryer (which broke when the flat above flooded our kitchen) with the cheapest shittiest washing machine available with no drying function. I have to run a dehumidifier 24/7 to stop the flat getting damp from all the drying laundry.

I have had to move 10 times in the last 6/7 years, I dream of having the security of a mortgage. But despite paying £1200+ a month for all those years we cannot get a mortgage as we don't have high enough combined salaries, even when mortgage calculators say a mortgage with our deposit would be half what we pay in rent now all the increases just make it harder to save to escape the renting trap.

I rented for 30 years and my rent toughly tripled over that time. I can’t imagine they would expect to pay the same in ten years as they would today? That would be strange.

My tenants have been in for 10 years. Rent hasn’t increased. They lost their home and came to us to ask as MIL had died and were desperate.

The house is immaculate. Lovely garden, put in a woodburner. She works PT and he jobs around as he had a heart attack few yrs ago. Rent is paid by BACS without fail.

We’ve been bitten times before with cheeky dirty fuckers so i am happy to leave the rent as it is. I suppose in a few yrs I’ll re-evaluate the situation and possibly raise it, but i cant see them refusing to pay as its well below the average. They couldn’t afford those prices.

It's a business not a charity. Get as much return as you can by whatever means possible. If that means new Tenants every six months then so be it. You're renting it out to male a profit, so maximise that profit.

Rents will always go up anyway, you may as well be honest about it and take the money while it's going.