To think private rent increases should be limited to inflation only

[Fancymice]

We are currently applying to rent a 2 bedroom house for £785 a month. The same house was up for rent previously 2 years ago for £695.

The seems like a massive increase, and other houses for rent on the area seem to have gone up by the same or even more. We're currently in a 3 bed for £850, but it has a dreadful damp problem. No doubt our landlord will paint it and put it back up for £900/£950.

Aibu to think private landlords should be limited in how much they increase rent? I understand that there is limited supply, so landlords are taking advantage of this to put up prices, but like most people my wages are not increasing on real terms and having a somewhere to live is quickly becoming unaffordable!!

It’s hard but it is fair. The rent is going up according to market rates and the landlord will be paying increased bills on eg trades, goods, and so on as everything goes up.

There needs to be a better way. We need more homes fast.

Not sure if still the case or even standard, but when I lived and rented in the UK, the lease agreement had a clause in it stating that at annual renewal of lease any rent increase would be limited to RPI index published on a certain website.

I think between tenants, they can raise or drop rent to whatever market will bear. But once you are a tenant, there may be a clause about rent increases like I had? Worth asking?

@PlanDeRaccordement

Not sure if still the case or even standard, but when I lived and rented in the UK, the lease agreement had a clause in it stating that at annual renewal of lease any rent increase would be limited to RPI index published on a certain website.

I think between tenants, they can raise or drop rent to whatever market will bear. But once you are a tenant, there may be a clause about rent increases like I had? Worth asking?

Thank-you, I shall look into this when signing the new tenancy.

Having a Google on citizens advice etc it says rent increases must be in line with current local rents, which seems a bit woolly.

The problem is inflation isnt necessarily a reflection of what the landlords costs are rising by. Their costs will include:

• rising capital costs of buying housing (pushes up mortgage payments)
• interest rates/access to mortgages
• the costs overall of void periods, tenants who don't pay, evictions
• long term damage/repairs/maintenance

Covid will have hit incomes hard, meaning more tenants struggling to pay, but landlords couldn't evict. Landlords can't afford to just swallow those costs so it pushes rents up.

Yeah it's insane. The house across from me has just gone up for rent for £595. I think that's a lot for a tiny 2 bed terraced house in the north east. Back when I lived in rented accommodation (pre 2018) I'd have paid no more than £450 pcm for a property of that size.

Rents shouldn't be based on inflation, no. They should be based on the monthly mortgage repayment the landlord has on the property, up to 90%. That way people who invest in property still benefit from price rises and only have to find a relatively small amount out of their own pocket each month, but they cannot exploit renters. Obviously once the mortgage is payed off, rent would decrease to zero.

@HarrietsChariot

Rents shouldn't be based on inflation, no. They should be based on the monthly mortgage repayment the landlord has on the property, up to 90%. That way people who invest in property still benefit from price rises and only have to find a relatively small amount out of their own pocket each month, but they cannot exploit renters. Obviously once the mortgage is payed off, rent would decrease to zero.

Except that doesn't take in to account insurance, maintenance, void periods, preparation of contracts/legal fees and all the other myriad costs of being a landlord. It would also mean that landlords who own their house outright couldn't charge rent at all...

That's the current case in Ireland, in "rent pressure zones":

www.irishtimes.com/news/social-affairs/rent-increases-to-be-capped-at-inflation-in-pressure-zones-1.4608191

@HarrietsChariot

Rents shouldn't be based on inflation, no. They should be based on the monthly mortgage repayment the landlord has on the property, up to 90%. That way people who invest in property still benefit from price rises and only have to find a relatively small amount out of their own pocket each month, but they cannot exploit renters. Obviously once the mortgage is payed off, rent would decrease to zero.

Haha, yeah ok

‘HarrietsChariot

Rents shouldn't be based on inflation, no. They should be based on the monthly mortgage repayment the landlord has on the property, up to 90%. That way people who invest in property still benefit from price rises and only have to find a relatively small amount out of their own pocket each month, but they cannot exploit renters. Obviously once the mortgage is payed off, rent would decrease to zero.’

😂😂 god this comment made me laugh! Sure fire way to kill the entire private rental market.

@DeepaBeesKit

The problem is inflation isnt necessarily a reflection of what the landlords costs are rising by. Their costs will include:

• rising capital costs of buying housing (pushes up mortgage payments)
• interest rates/access to mortgages
• the costs overall of void periods, tenants who don't pay, evictions
• long term damage/repairs/maintenance

Covid will have hit incomes hard, meaning more tenants struggling to pay, but landlords couldn't evict. Landlords can't afford to just swallow those costs so it pushes rents up.

I think this is the issue - landlords expect the money they receive from rent to cover all of these things - which imo is completely unfair. I do not think I should have to pay more money becauseof void periods for example. The landlord should be prepared to absorb the cost of this.

Also I don't agree with rent being expected to pay for long term damage and repairs. The landlord is the owner of the property, and is ultimately responsible for those costs. Renting should be cheaper than owning a house, but that really doesn't seem to be the case.

YABU. It’s a business; they should be allowed to have the rent as high as the market will allow.

Ie. If there’s someone willing to pay it, it’s acceptable.

Rents should be capped in some way but it would be a rather complicated system.

My 3 bedroom is worth much less than one a 10 minute drive away so rental prices would have to reflect that. Although at the same time I think it’s bonkers that some very standard plain Jayne houses in my area are renting for over £1,000 - £2,000 a month. They anit mansions with pools and marble floors just bog standard 3/4 beds with a drive.

I think this is the issue - landlords expect the money they receive from rent to cover all of these things - which imo is completely unfair. I do not think I should have to pay more money becauseof void periods for example. The landlord should be prepared to absorb the cost of this.

Also I don't agree with rent being expected to pay for long term damage and repairs. The landlord is the owner of the property, and is ultimately responsible for those costs. Renting should be cheaper than owning a house, but that really doesn't seem to be the case.

But it's a BUSINESS not a charity, so why should the landlord absorb the costs? If the figures don't add up then landlords will leave the market and in that case good luck finding somewhere to live!

@TheHouseILiveIn

I think this is the issue - landlords expect the money they receive from rent to cover all of these things - which imo is completely unfair. I do not think I should have to pay more money becauseof void periods for example. The landlord should be prepared to absorb the cost of this.

Also I don't agree with rent being expected to pay for long term damage and repairs. The landlord is the owner of the property, and is ultimately responsible for those costs. Renting should be cheaper than owning a house, but that really doesn't seem to be the case.

But it's a BUSINESS not a charity, so why should the landlord absorb the costs? If the figures don't add up then landlords will leave the market and in that case good luck finding somewhere to live!

It is still a viable business without rinsing the tenant for every single conceivable cost.

Expecting to put down a deposit to get a btl mortgage and then never put your own money into maintenance etc is just insanely greedy!

Other countries manage to have rent controls and better protections for tenants without the entirety of capitalism breaking down and melting into a puddle of communism.

Take a long hard look at housing in this country - houses have become an investment vehicle rather than a home.

Noone forces a landlord to become a landlord but everyone needs (and deserves) safe, adequate, long term shelter.

Not sure if still the case or even standard, but when I lived and rented in the UK, the lease agreement had a clause in it stating that at annual renewal of lease any rent increase would be limited to RPI index published on a certain website

My tenancy limits rises to 5% on each renewal.

The housing situation in this country is ridiculous and is a result of poor government policy over the last 20+ years. B2L landlords exploit the situation. A proper Labour government would offer real ways to tackle this. As others have said other countries have rent controls and restrictions such that becoming a landlord doesn't look like some sort of massive money spinner. I'd vote for that

On a more positive note I have a very lovely landlord who has just offered to gift me a nursing chair (on finding out I'm pregnant)

YABU. Most landlords want to make a profit, not just cover the cost of their mortgage. If demand is higher in an area, of course they'll charge more.

They also need to take into account costs of repairs, loss of earnings if they lose a tenant, etc.

YABU. For some it is a business , therefore they need a profit to live of themselves

For some they fell into being a landlord, may only have one property they are renting out as a investment for retirement. They may not be able to afford to ‘absorb’ the costs mentioned, and why should they?

Rent needs to cover not only the mortgage, but also to be able to save towards costs of replacement boilers, repairs and maintenance, why should the6 be out of pocket to let you live there?

If you don’t like it then don’t rent, but your own place, live with family, other options are out there

Yanbu but I'd add that it should be either at inflation rate or at a set low rate (say 2%), whichever is lower. In order to protect tenants against soaring inflation.

@TheHouseILiveIn

I think this is the issue - landlords expect the money they receive from rent to cover all of these things - which imo is completely unfair. I do not think I should have to pay more money becauseof void periods for example. The landlord should be prepared to absorb the cost of this.

Also I don't agree with rent being expected to pay for long term damage and repairs. The landlord is the owner of the property, and is ultimately responsible for those costs. Renting should be cheaper than owning a house, but that really doesn't seem to be the case.

But it's a BUSINESS not a charity, so why should the landlord absorb the costs? If the figures don't add up then landlords will leave the market and in that case good luck finding somewhere to live!

The tenant isn't a charity either, and nor should they be expected to cover all the costs of the business that the landlord is running to maximise their profit and reduce their outgoings and risk.

Running a business is a risky venture and if you choose to do so, you also choose the risks and outlay that go with that. Why should a tenant pay more so that a landlord can cover future possible costs they may encounter, or improve and expand their business, or improve their profits, how does that benefit the tenant in any way? They're not getting more for their money. Because they're paying to cover the costs of a business the landlord chose to enter into, rather than paying for the use of a property for an amount of time.

But that's the way the renting business is in reality, reap the rewards when things are good, pat yourself on the back for your shrewd business acumen and hard work, but pass on the costs and responsibilities when things take a turn for the worse and say you're not a charity, and regardless of the reason there's a downturn in income and that it's just a part of being a business, refuse to acknowledge that as the owner of the business, it's what you entered into in the first place.

Sounds fair to me. Family homes shouldn’t be investor-fodder. Lots of people will come up with reasons why neither this nor anything else should be done. They usually have a vested interest.

We own a house that we rent out and we do not have a mortgage on it, we own it outright, so we cannot link any increased to mortgage payments. Now will be let someone live in it rent free, what an utter ridiculous suggestion.

However we haven’t raised the rent at all in 7 years, even told the agents not to recommend raising the rent. When (if?) the current tenant leaves, we will refurbish and set the new rent at an average for market in that area. Until then, no increases. We want this tenant to stay as she is a good tenant so we will not do anything to make her life more expensive or difficult.