Rent increase by £300!!! What do I do? Is this normal? Please help!!!!

[Lele101]

Just got a text from landlord

“mortgage gone up and I’m paying 300 more for service charges and insurance to the council I have no choice but to raise rent by 300”

we live in ilford, Barkingside. It’s a 2 bedroom flat. Currently paying 1400, now he wants 1700.

last increase was 16 months ago. (From 1225 to 1400)

im shocked. Is this normal?? Please advice. I don’t know what to do.

Yes sorry, a bit out of touch clearly. Maybe privilege isn't the right word as we have both worked our tits off for 35 years, had to earn every penny we have and never had any input/inheritance from anyone. Probably disconnected may be a better description - my admission.

For some of us there are only two choices raise the rent or sell. My mortgage comes to an end in July at the low rate and will increase by around 500 a month. It is a large mortgage. Currently the rent already does not fully cover the cost of the mortgage, insurance etc. So in July, it will be way down. No increase for 8 years so far. I can either raise it by 300 or 400 a month (which still leaves me losing a significant amount of money) or I sell. I cannot keep going at such a loss. I have only 8 more years or so on the mortgage, which is why I have been struggling to keep the property. It is way under the rental value of properties in the area. But I don't think the tenants will be able to afford any increase. So I am stuck.

If you're "running a business" then you should have done some financial planning around this. Why didn't you model for interest rate rises? Why haven't you put the rent up in 8 years if you're already not covering your costs and you knew you couldn't handle the mortgage rate increase? If you'd charged an extra £50/month over those 8 years you'd be able to cover 12 months of an additional £400/month. Instead some poor sods will likely be made homeless.

As someone who runs a business (a real one) this stuff makes me really cross.

That’s not a mortgage payment on an 800k mortgage though. You mean you’ve paid off most of it which is irrelevant to renters.

Landlord’s aren’t charities and in this instance they aren’t doing anything wrong. So what that they want to raise the rent to the market rate? It’s completely fair. If OP won’t pay then there’ll be plenty of people who will.

I agree you must negotiate - that is far to big a hike. But be aware that landlords might choose to sell if they are making a loss on the property.

Are you in a position at work to ask for a pay rise? Or is anyone else in your family?

OP people have already given you some good advice about Shelter and negotiating a smaller increase, but longer term have you thought of looking into shared-ownership properties as a way to get on the housing ladder? if you can get a shared-ownership house especially, it can give you more security.

I started by buying a shared-ownership flat in East London because that is all I could afford and then sold it and bought a small terrace in Kent.

Being at the mercy of private landlords is just horrific. So many are just greedy parasites...

Anecdotally it is cheaper to rent than buy in my area at the moment.
A 3 bed house on 100% mortgage would be 2.5k in mortgage and 2.2k to rent.
Trouble is some landlords want ALL their costs covered and expect to benefit from rise in equity and house prices.
If he can’t cope with a period of loss he needs to get out. Sounds as though he can probably get the increase if he relets though. Best bet is that you can pay less as he will factor in voids and risk of a poor tenant next time.

Unfortunately they aren’t- they are wrong.

It’s one month notice for a monthly tenancy and the need for a s13 notice depends on whether or not the lease has a rent review clause and wording that covers what happens when the fix term ends.

OP you need to check market rents in your area for similar properties and then get expert advice. Nobody can fully advise you without seeing your contract.

Totally agree. Previously people who were this greedy would have been judged harshly, now it seems to be pretty standard behaviour in some groups and greed is generally admired. I'm still in the judge harshly camp!

Go to the housing section of the Money Saving Expert Forum. There are lots of landlords on there who advise tenants on their rights. They really do know what they are talking about.

https://forums.moneysavingexpert.com/categories/house-buying-renting-selling

If you say you can’t afford it he may well give you notice to end the tenancy and get someone to move in who can afford it.

And if the OP can't do a £300 increase, where do you suggest she gets an £80k deposit from?

@m00rfarm Have you thought about evicting your tenants and finding new ones?

This . It sounds like a sneaky way of evicting you OP . He or she is hoping you just give your notice in and go . Then they will get in a tenant who will pay this rent .

This is just going to get worse, so many landlords now selling up, before Labour puts the the renters reform bill in, I think something like a million less properties on the last 5 years and this is going to escalate it a lot faster.

so with supply being limited and demand increasing for the limited supply , rents will go up and up.

this is now coupled with interest rates increasing due again sadly to Labour budget, costs obvs being passed onto renters as private landlords are not social landlords, it’s a business. And we don’t have the council houses to house people in either,

of course he needs to formally notify via section 13 , a text is fine as first informal heads up explaining it, but he then needs to follow up with the formal notice.

hopefully he isn’t charging exactly what he is paying and has room to reduce for you, it does appear he is charging below market rates, but the condition of the flat may be bad,, if he is not you may need to look for alternate accommodation if you can’t afford it.

its a hard time for renters and it’s going to get so much worse sadly,

Surely you know that many tenants can't afford to buy and that the figures you have quoted here are ridiculous and not at all representative of what people need to pay.
You must have bought your house, which you think is worth 800k, many years ago when it was worth much less, so the 800k is irrelevant, or have had a huge deposit and only taken out a small mortgage. Currently, you need an approx. 200k salary to be able take out an 800k mortgage and it would cost many multiples of your £1000/month. Really poor advice!

Those talking about the increase in interest rates to 4.5….Historically 4-5% was the usual
interest rate I think? It was a blip, these ultra low interest rates. If landlording is a business and landlords didn’t factor in contingency for increases in interest rates, they can’t afford to be in business.
Essentially if you have a mortgage you couldn’t cover with your own funds you can’t afford to be a BTL landlord.
Secondly it would be helpful if the government would reverse some of the tax changes that were made to reduce landlord profit, since clearly all that has happened is more and more of them selling up, which has drastically reduced supply and of course increased demand/ price.
The fact that housing is so incredibly precarious in this country is a disgrace and a national emergency.

Before you go back to the landlord speak to a few estate agents this morning and have a quick look on rightmove and see what is available. You have a much better chance negotiating with him if you know what the market rates are. People here are suggesting that you go back saying you can't afford £300 but if he knows he is charging you below market rate still then you might not get anywhere.

Equally if the increase is unfair , and you see similar properties out there that are in line with what you are currently paying or only £100 more then you know you can push the conversation a bit more

I think they can put it up again in a 12 month period. Have a look around-can you get something similar for the amount you are currently paying? If so, I'd move. If not, I think you're going to have to pay or risk being evicted.

That's awful, even worse as sent by text.
When I used to rent out my ikd flat I didn't increase my rent for 10 years as had a really good tennant. However thr mortgage didn't rise.

If the fixed rate deal didn't end then it makes no difference so your comment is irrelevant about the cuts in the rates. If LL had a low rate fixed deal it'll be a big jump.
OP look around at market rate for the area and see if you can negotiate a deal. There will be costs on both sides if you move out.
Is there any chance they're doing this to get you to move?

Is the new amount the market rate? If you look on rightmove what would you pay for your flat? If you can get something cheaper then maybe look to move or email him the links and negotiate but rents have risen significantly over the past few years due to rising population - so you may find you have been paying less than market rate and now it’s in line with other properties.

Are you not on an AST? In which case he can't it up until it's time for renewal. If not, I'd get one in place or move.

That's a big jump and is high op, I don't blame you

That is a massive increase. And I bet your Council Tax is going up from April as well. I really worry about the prospects for people in this country. Life seems to be getting harder and harder with no sign of it ever getting any better. Where I live a lot of landlords are turning their properties into short term holiday lets. I don’t think people should be allowed to use residential property to make a monthly profit. It’s immoral. Housing is a basic need and everyone should be entitled to somewhere safe to live.