my landlord’s unable to absorb cost of living increase

[originstory]

so he’s raising my rent during a 1 year contract. AIBU to refuse?

I got a letter from landlord saying my rent is going up by 5% (£40). he explains that he’s no longer able to continue absorbing rising costs so has to pass it onto his tenants. regrets having to do this, feels forced into it by circumstances beyond his control etc. if I had a rolling month to month contract, fair enough, I’ve had rent increases in previous properties which is just what happens. but I signed a 1 year contract in February so didn’t think he could raise the rent during that contract? my googling appears to back me up but maybe someone will tell me I’m wrong. however, I’m considering just sucking it up for an easier life. AIBU to dispute this?

reasons to dispute it:

• I have a contract until Feb 2023 so I feel he’s being cheeky to increase rent during it. Obviously it will increase when that ends and converts to a month to month rolling contract, which is fine.
• The cost of living increase is hitting ALL of us (and will continue to get worse) and I must admit I have less sympathy for a landlord who owns multiple properties than I do his tenants
• I don’t have a high income (at all) due to reduced capacity for work due to a chronic illness, which he knows. in fact it’s so low that I started claiming UC for the first time last year, so I resent paying him an extra £40 a month that could go towards my gas bill or food shopping

reasons to just agree:

• he’s a good landlord, sorts repairs and problems promptly and reasonably
• he’s correct in that he’ll be paying more for hallway lighting etc
• he’s a nice man so I’d feel bad saying ‘i’m not giving you more money, too bad’
• 5% is a very reasonable increase so it seems stupid to cause problems over it. If it was more I’d have less of an issue saying no
• I felt lucky to find a landlord to rent to me in the first place due to my low income/ being on UC so it would be stupid to sour our relationship over £40
• If I refused to pay I’d be wondering if he’s going to get rid of me when the contract is up because I ‘caused trouble’ and then I’d be back in the position of not knowing if I can find anyone willing to rent to me. i had several agencies refuse to let me even view properties as I’m on UC (illegal but it still happens)
• honestly, I don’t like confrontation and it’s simply easier to just agree

AIBU to dispute this?

@SwanBuster

Agreed HTB and SD freeze increased asset (house prices). Other countries did similar though, Australia in particular. It really has been a global frenzy. It isn't just landlords who have been affected by this though, it's everyone who has bought it sold a property.

I still think this Tory government have come down harder than any other government on landlords. My reasons are already mentioned.

Out of interest, what do you think is coming next? I think QT and interest rate rises mean that all those who used debt to invest in housing are likely in trouble.

If the LL is trying to put prices up during your contract, he's probably struggling. Which means that even if you pay the increase, he might still be struggling. So, I'd get ready for him to try to sell the property. It's usually easier to sell with vacant possession... which means an eviction notice for you in due course.

I'd be inclined to not pay the increase, but to squirrel away that £40 (plus whatever you can) for a deposit for a new place. You just know you're going to have to move on again soon. The question is when.

100% agree it's not just been UK.

I think this 'tough on landlords' stuff i think has been a signal to the smarter ones to get out.

Simultaneously they had (hopefully) a last hurrah of asset prices rises; and now I'm praying reality bites for everyone who's been getting high on cheap money.

Yeah, I think the effects of QT and rate rises will be very interesting. The Fed are being far more aggressive than the bank of england thus far. If there continues to be a difference between their behaviours, then sterling is even more toast than it has been already. Maybe that's what the BOE / gov wants. They want the debt inflated away. They don't care if a loaf of bread rises to £4....

Anyway - all I hope for is some kind of proper reset. They had the chance in 2008 worldwide and didn't. Now we have had 14 years of even more disenfranchisement for the global youth. I think it's time the scales were tipped the other way. Otherwise big trouble ahead in many different ways - some peaceful but tragic (the lie flat movement where the youth say 'whats the point') and some not so likely to be so peaceful (more nationalism etc).

Yeah, I think the effects of QT and rate rises will be very interesting. The Fed are being far more aggressive than the bank of england thus far. If there continues to be a difference between their behaviours, then sterling is even more toast than it has been already. Maybe that's what the BOE / gov wants. They want the debt inflated away. They don't care if a loaf of bread rises to £4....

Inflation will be out of control if sterling tanks but perhaps the government is engineering that so that their debts will be inflated away.

Given it's a global economy though, I'm not sure how much control our government will have over what happens next.

The clear and present danger now is that markets might decide that the dubious attractions of Sterling are far outweighed by the risks. A “Sterling crisis” would force the Bank of England into raising rates, crashing the property market to which the economy is, increasingly, an adjunct.

I've never heard anybody suggest that housing is easier now than it was in the 70s. Everyone I knew lived in a council house in the 70s. I didn't hear of anyone being on a long waiting list for one as there were many more than there are today. It was much easier to buy a house as well.

It was not easy to buy a house in the seventies as there were very strict mortgage rules. You needed references, a history of saving with the relevant bank, and low multiples of wages. But if you had a steady permanent job, then prices were still less.
Early seventies there was still slum clearance happening with some still living in places with no bathroom. But there was a lot of council house building which meant if you were prepared to move, you could get a house much more easily.

Mid to late seventies is when council housing got much easier to get.
Private housing standards though were often very low.

Legally, you can fight it. Realistically, I'd pay it - but try to get an agreement that he doesn't increase again next February.

Rents, social or private, can be increased at the rate of inflation, and are forecast to go up by at least 10% next year. So, if you don't have another increase in February, you might actually save on it.

Interest rates are expected to keep going upwards, which will affect many mortgages/landlords.

Decent private rentals, if on benefits, are becoming harder and harder to get. Social housing is virtually non-existent unless you are a very high priority.

The abolition of the S21 seems to be following the path that most other government promises go down - big announcement, then it gets kicked into the long grass.🙄

So, unfair as it is, in your circumstances, I'd suck it up - but try to ensure no further increases next year.

Simultaneously they had (hopefully) a last hurrah of asset prices rises; and now I'm praying reality bites for everyone who's been getting high on cheap money.
Thats lots of working parents on this site @SwanBuster
Taking their assets and putting them into the hands of landlords with cash and corporations sounds a spectacular plan, said nobody ever.

This comment is hilarious. If he feels he needs more money he needs more money… what the actual fuck? If the landlord cannot cope with people living in their asset it’s the wrong job for them and they need to sell. And you need your head screwing on.

I didn't say it was easy in the 70s. I said that it was much easier than today. My parents bought their first house in their early 20s as new graduates.

Comparing with the past can be hard. In 1900 90% of people rented from private landlords (did not own any property). After the war my parents put off babies for TEN years as they needed 2 full time professional wages to buy their house in the NE of England in which they lived for 50 years and that was very hard as my father kept being called up for national service and let down so no one would hire him even as a doctor for a few years. Women could not easily get mortgages in their own names as everyone expected them to leave work and have babies. There was then massive inflation in the 1970s (60% over 3 years at one point) so not an easy time for many and I definitely remember there were council house waiting lists, films like Cathy come home, lack of housing etc etc.

Then we had 1982 when I graduated - a blood bath - 3m out of work, biggest unemployment in the UK for FIFTY years. I applied for 139 jobs and had 25 interviews before getting one during the last year of my degree. Again like my parents we needed two full time professional salaries and to buy before babies to be able to afford our first house bought in 1984 which had to be out here in zone 5 outer London as inner London then and now was far too expensive. It was so hard to buy as London was so expensive my husband's school offered flats to teachers and nurses lives in nurses homes etc. We lived in one school flat and I had a mattress on the floor when pregnant but were able to buy just before I gave bith. I worked until I was in labour and went back at 2 weeks full time. I am just not convinced times are harder now. Also when I came to London in 1983 it was hard to find places to rent as the rent acts had meant no l;andlords who were decent would let out a property as the rents could be fixed for life at £10 a year etc. So my first place as a trainee lawyer in London was one room with a sink and a hob (bed sit) and a dirty shower down the corridor everyone shared for the first term until my husband joined me and we moved to the school flat.

If it was illegal for them to raise it, yes I would

Eh?

If someone - whoever - has been borrowing lots of money and gets margin called because zero interest rate policy can't last forever - that is their problem!!!

Cash savers and people who have tried not to borrow excessively or participate in this debt fuelled madness have been fucked over for 14 years. I will not shed one tear for anyone in debt.

(debt that has been taken on willingly and without looking at the consequence of rate rises that is)

anyone in debt because the cost of living means their income is less than their essential expenses and they've had to borrow from predatory lenders has my full sympathy.

Ok, so they've made a big investment and it hasn't worked out. They'll have to sell up and try something else, like any other person who chooses to invest their excess capital in the hope of increasing it. Why are we supposed to feel more sympathy for a landlord than for someone who bought shares in Google? You can't pick and choose the bits of capitalism that suit you - you have to accept the risks as well as the rewards.

So I would say the debt fuelled madness has been going on for at least 23 years minimum.
Most of these so called idiots that you have no sympathy for are ordinary hard-working people. There is enormous potential for the very people that you think you want to help to get caught in the crossfire of all this i.e. the ones whose income was never enough to even cover their rent or bills.

be careful what you wish for because at the moment the whole deck of cards is being held up by Debt and if that supply is cut off as we saw in 2008 the people who will suffer the absolute most are the very poorest in society. Luckily in 2008 there was still a bit of a cushion, that’s gone now. You’d have to be a bit of a cunt to wish their lives to get worse in order to financially gain yourself.

I'll take your last line and repeat it back to you - that you would have to be a bit of a c**t not to want a better, more sustainable economic model for future generations. The current one is working rather poorly for anyone who hasn't loaded up on debt or already has assets. Largely by thanks to their date of birth.

Massive amounts of disenfranchisement to come if this continues.

It's not about me benefitting - I'm fine, thanks.

Well luckily for the generation of 35 to 50-year-olds that you would be happily throwing under a bus none of the parties seem to be able to think further than one election ahead and so the pyramid scheme will continue. With peaks and troughs of course but the reality of it is you can whinge about the debt as much as you like, it’s what makes the world go round.

If you’re “fine” I would suggest youre probably of an age where none of this is going to affect you and you won’t be around much longer to see it.

@badgermushrooms that's exactly the point you have nailed- people who are doing ok like to talk about market value - so when it comes to buying/selling/renting property, commercial property too they say well the market value is xxx . Very few of them like it if they can't sell or rent out and not keen to accept the market value is way way less than what they think- in fact the market value is whatever someone else is prepared to pay , not some random figure . I think there will be some market value 'corrections' particularly in areas of low and sluggish demand in the next few years. Sadly I think rental values will stay quite high unless there is a radical rethink on housing- simply due to a shortage of properties and a lack of social housing, as a great many people just cannot fulfill deposit/ mortgage criteria , especially in high value areas.

@Crikeyalmighty Yes absolutely we need to build, on a massive scale. Otherwise everything else - getting rid of section 21 evictions, these ridiculous 50 year multigenerational mortgages - is just tinkering around the edges. The most depressing thing about this thread is that the OP's landlord is entirely in the wrong both legally and morally and yet she's probably going to have to let him get away with it as her other options are so lacking.

Those of us who have managed to buy are just going to have to accept an end to property values automatically going up with time. If we want a bigger place we'll have to get a better job, rather than sitting on our backsides waiting for the next poor sucker to come in at the bottom of the pyramid scheme. We need to build so quickly that house prices don't move an inch for the next decade at least, otherwise we are going to be seeing more and more kids raised in damp B&Bs and more and more talented young professionals giving up on this country entirely.

This is untrue. It is entirely possible, and is a frequent occurence that contracts can be varied by consent. In that sense tenancy agreements are no different to any other contract. So if you both consent, the new term takes effect as agreed, from the agreed date.

If Op does not agree to vary the contract the landlord cannot raise the rent and expect the tenant to make the increased payments because he cannot unilaterally change the terms of the contract and cannot force a change because it is within the fixed term. He can try, but it will not be upheld by a court, therefore he cannot enforce any attempt at unilaterally changing the contract.

If Op agrees this new term, then she is not agreeing to change it at a later date nor is she consenting to anything other than the new rent, so suggesting the landlord will increase the rent further during the fixed term is a moot point because of the points made above.

Generally speaking after a fixed term has expired the rent can be increased unilaterally using a s13, providing it has been properly notified with the correct notice period. I say generally because if the tenancy agreement rolls over after the end of the fixed term to a contractual periodic tenancy then the landlord is still bound by the terms in the contract and must follow the rent increase procedure in that contract, unless the tenant agrees to vary it. If it is a statutory periodic tenancy then the s13 procedure is used if the landlord and tenant cannot agree a variation of the rent and so it can be unilateral.

I hope that clears things up as to the legal position.

@badgermushrooms I totally agree- having just moved back from Copenhagen one of the things in Denmark is that once Danes get to 25 I believe, they are allocated a flat. (They pay rent) a lot are new builds and nice too . That flat remains theirs, at social housing levels of rent. they can sub let it if they move in with someone etc. so when marriages go wrong etc there is usually a flat that can be moved back to - many use a spell of saving up to buy whilst in their subsidised flat.

No, I'm pretty young. Just sensible with money and earn a decent wedge.

But it sounds like you're loaded with debt, and panicking. I'd happily see people like you squeal yes, if under 50s who decided they wouldn't participate in the credit orgy get one of your repossessed buy to let's.