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.

This is wrong, factually rentals are decreasing, significantly. Landlords are exiting they are not snapping them up, that’s why there is a shortage of rentals in many places and rents increasing.

landlords have been exiting for at least five years, we are over a million properties less. And no house pricing has not decreased due to it. It has continued to rise.

I'm a LL. Due to interest rate rises the rent is £800 per month LESS than the mortgage. However, I don't get all the rent, 11% goes to the agent. On top of this I pay a significant service charge to the management company. I also pay for insurance, a gas service charge to cover the boiler, repairs, maintenance, engineer call outs, the relevant safety checks and licences etc etc. I make an enormous loss every month. I'm not making a capital gain either, values in that area peaked a while back have dropped... largely because landlords are frantically getting out. I'm struggling hugely but obviously no sympathy because I'm a bastard LL who is using the poor struggling tenant to pay my mortgage.

I'd like to sell, but funnily enough nothing is selling because who would buy? There is a glut of rental flats on the market. LLs don't want them and tenants don't either because it's cheaper to rent.
At the end of the day renting is a business but landlords are treated as a blight not business owners and are being hit with more and more tax raids and red tape than any other business in what I guess is a push to get them out. So they are leaving. The end result is low supply and high demand which means tenants are scrabbling to get properties and rents are going to rise. This helps no one.

The UK takes in a million immigrants a year. Presumably they can't buy a house straight away or qualify for social housing, so they must have to rent privately. Immigration has to be addressed.

At the end of the day renting is a business but landlords are treated as a blight not business owners and are being hit with more and more tax raids and red tape than any other business in what I guess is a push to get them out

Being a landlord does not create any GDP or jobs. It's just a transfer of money from poorer to richer. That's why it's a blight and that's why they should be taxed more than actual businesses.

I agree with PP who have said that it's unreasonable for the LL to expect you to cover all his increased mortgage costs. However I think you should be prepared to cover any increase in service charges, council fees and so on. These are things that anyone has to pay regardless of where you live and it's not reasonable to expect your LL to cover those for you.

My service charges have doubled in the last two years but that's par for the course for home maintenance - everything has become much more expensive.

I too am a landlord though I acquired mine by marrying my partner-not sure what I could have done about that apart from marry someone else!

I've never made any money off the properties in nearly 20 years (they're all flats) and I try and keep all rents below market rate and don't increase rents for long-term tenants. But every year, service charges increase by at least 10% (insurance increases, utilities going up, increased staffing costs), and then there are repairs to the building—2 of my properties are in buildings that need new lifts this year at a charge of at least £1k per flat. I currently subsidise all my properties and have done so for years.

I don't pass on increases to my tenants as it's not their fault and I do run them as a business (despite them not being taxed as a business!) but it is bloody hard work and I'd love to sell them. They are all, however, worthless due to cladding and fire safety issues, which are taking years to sort out.

I've sold 2 to date—one for £1k more than I paid and the other at a loss to a long-term tenant, so I sold it to them at 10% below market value which seemed fair. It then turned out they owned 3 other properties in the building they rented out...

I wouldn't dream of chucking a £300 increase at a tenant on a rent of £1400 (I stick to 2-3% increases when I have to increase), but I do have a great long-term tenant who pays about 30% below market rate, and when HMRC audited my accounts, I got the Spanish inquisition over this as it seems it looks suspicious and they assumed I was taking cash as well. I spent 6 months arguing with them over this and other idiotic questions they came up with. So, charging below-market rents can cause you issues!

Personally, I have more of an issue with the profit banks make over mortgage interest rates and bloody HMRC's taxation rates for landlords, which lead to high rents, though there are definitely unscrupulous landlords out there. Just like there are unscrupulous people in most lines of business.

This is so short sighted, or you dislike renters.

taxing them means costs passed on to the renters, just like it does when you tax sainsbos more. Or it forces them out, as it is doing now, meaning landlords put prices up as demand outstrips supply. And many people can’t find somewhere to rent, or can’t afford to

the Sector is becoming crippled as they all exit. Big companies are swooping in, they screw the tenant for rent.

sure, you’ve got your way. But look at the result.

I'm on a landlord forum out of interest and many are selling. They are sick and tired of having to chase rent.
They are tired of people leaving their houses in a mess.
Nobody ever gets done for criminal damage. They just bugger off a leave a mess and damage.

They are tired of the new rules and regulations and all the rights of tenants.
Don't landlords have to accept pets or something. I think I read that it's coming in?

So therefore they won't simply find someone else as you say.
It's not that easy.
Alot of people cannot afford high rents every month and things go wrong.
Letting out costs the landlord money as well.
Lost money while house is empty. Re letting fees etc.

Depends entirely on the area. Not all of the UK is in the same phase of the housing market. In some areas, landlords are still snapping up cheap and "do-er uppers" in great numbers.

I think some LL's are increasing rents in line with market values now if previously they had been content to allow rent below market value. Once RRB is in place there will be restrictions on rent increases so a lot of LL's might be trying to get rent in line with market value before RRB is in place. Or, LL wants to get rid of you before RRB in place. Raising rent is one way to get some tenants who caused low level issues like repeatedly not to pay the rent on time, or causing mild issues for neighbours. Ultimately you can try to negotiate a lower rent increase but will have to decide if you want to accept a substantial rent increase or vacate. Look at other rents in your area for similar accommodation. That will tell you what market rents are. I'm a LL and I increase my rents every year by a modest amount because tenants have told me they prefer a small increase each year in line with inflation or just above if mortgage rates have increased than several years of no increase and then a larger increase.

They aren't even taxed the same as actual businesses. Landlords are exempt from NIC, which "real" business owners have to pay. So, a landlord is actually paying less tax than a real business, because they're not taxed as real businesses - their income is exempt from NIC!

If your wages are not going up, how do you afford a rent rise?

It's a 2 way thing.

It's a service as well. I did mention if no rental homes, where will people live, who can't afford to buy?

Councils can't house everyone.

Well no they don’t pay national insurance if they don’t employ anyone. Clearly. But they pay 20 or 40 percent based on how much they earn either in rental income or from the day job and where it takes you in terms of the threshold.

Dosent mean the tenants will be good payers and won't smash the house up.
It's not all it's cracked up to be.

Most MPS are buy to let LLs, that's why they support mass immigration, it increases demand, which is good for landlords. Tenants from abroad are hardly likely to risk their immigration status by being bad tenants.

I used to live in a rental where the landlord decided to add a few hundred onto the rent, and it pissed me off so much I stopped paying rent entirely.

It took him nearly a year to go through the eviction process (though I moved elsewhere before it was completed) and in that time he lost many thousands in rental income, which I never paid back.

It was quite stressful for me too but the retaliation was worth it. Very satisfying to know he was losing money hand over fist. Hopefully he'll think twice before inflicting this sort of demand on someone else.

Maybe this isn't the strategy you want to go for right now but worth considering if you want to screw him over.

Is that not theft?

One of the reasons landlords are selling up in their droves. Tenants like this.

Proud of your theft? Sounds like it.

Do you steal from supermarkets too?

This is not a good example of what to do. Your credit rating could be ruined, making it really hard to get another property. The council does not treat rent arrears favourably so any social housing you may be due would be denied and you'd stuck at the bottom of the list
If the LL goes to court to recover funds you'll get a CCJ lasting 6 years.

Despite what you think, this is theft, plain and simple and I wouldn't be boasting about it

It worked out great, I was in a lot of debt then so I used the money I saved in rent to pay all that off. Ended up lodging with a friend of a friend who was a lovely old lady, much better arrangement all round.

I suppose he could have took me to court but I told him I was broke so maybe that's why he didn't bother.

It was the right decision at the time and I don't regret it at all.

Landlords need to remember that they don't have all the power and these greedy leeches can't just put up rents whenever they feel like it. At least they can't just snatch all the deposit like they used to do, which was actual theft, not just squatting which is what not paying rent is really.

Squatting is a criminal act.

I'm glad you're out of debt but it's still theft. You entered into a contract and defaulted because you didn't like the changes. I don't like paying double my weekly shop for the same produce, but it doesn't mean I go into a supermarket and steal because Tesco unfairly raise prices to increase their Director profits.
Theft is theft!

I wouldn't advise anyone to stop paying rent because a CCJ will be hard to remove and you'll be stuck if you want to obtain any credit or future accommodation.

Please don't follow this advice of non payment.

That's why DS lives at home.

It wasn't advice really, I mean whether it makes sense to completely withhold rent or not depends on your situation and for me it helped that, at the time, I was broke and single with no dependants.

What she could do is refuse to pay the new level of rent that the landlord demands but just keep paying the old rent. Then the landlord has to decide whether he wants to evict which is a long process and can be drawn out for years if needed.

Things like this are why BTL is not a good thing for most people.