Rental price - should we increase it?

[honeybuzzle]

Hi
Quick background.
We first put our old family home up for rent about 5 years ago through a letting agency at the price they felt was right. (First time - Naive landlords). It was a disaster. Totally wrong people in the house. When they served notice we had to gut the whole place and decided to do it ourselves and increased the rent by 10%. We got great tenants - everybody happy! When they bought their own house, we again upped the rent by 10% got a few interested parties and found tenants who were ok but only stayed a year as they moved location. Skip forward to now - our current tenants have served notice, after 3 years, as they are moving closer to their business. We advertised again, increasing the rental once more. Interest has been massive. I am getting multiple requests every day. We initially set up viewings for the first 12 enquiries, but then decided we were going to do more work ie replace kitchens, install patio doors etc. so we cancelled viewings to allow the work to take place and show the house at it's best. So my question: - due to the demand we've seen at the advertised price, would you increase the rental price up when the work is done or honour the rental price it was first advertised at? My OH is all about the business, I'm more about the right people and having integrity, (Not that I have made any promises to anyone!)
Sorry for the long post but didn't want to drip feed. I would welcome any advice from 'seasoned' landlords.
Thanks

You get good and bad tenants at any price point. But as you have so much demand then yes - try it a bit higher, and you can always adjust if you need to. Vet the people as thoroughly as you can, though crap tenants are good at putting on a good front. Check references.

Thanks Midlife
Would you include a price increase for the original interested parties too? I just feel weird about that. (I'm too soft!!)

People are desperate for rental houses at the moment - tbh it feels a bit distasteful capitalising on that.

I have quite a well paid job and rent. I compare my house to current rentals and almost hyperventilate at how much the rent is. I get what you are saying about the 'right' tenant but I'm a wonderful tenant who cannot afford top whack. The difficulty is I'm single. I have no one to share the rent with.

Sorry I should have been more clear. I pay around 200 less than the current market value. I will really struggle if I have to leave my current house.

Will those who were interested previously still be looking? How long will the works take? Renting isn't like buying.

I’d get a local rental agent to value it, you don’t have to commit to go with them & then see if you are completely off the mark.

We pay £1400 a month rental for a house we started renting just over two years ago, this house would now go for £2k a month (the rental market is insane). It’s riddled with mould and damp, but having looked at what is available we’re sticking with it & hoping the landlords sort the issue.

Definitely worth checking - we’re also landlords (we can’t afford to buy a house big enough for a family of four but own a one bed flat locally) & I know our tenant has been looking for something else, but like us has realised he has a good deal as prices have rocketed so has just committed to another 12 months.

Also if you are renovating then the rent you can get will be higher for a more appealing house - so just tell prospective tenants you are taking it off the market and then put it on at the appropriate price once you’ve done the improvements. As you lose a third of that income to tax it’s not worth losing more to ‘honour’ a price that you haven’t committed to IMO.

Why have rented houses gone up so much? If it were me,I would be more bothered about getting good, long term tenants than making a quick profit. Any improvements you have made on the house just increase the value of the house to sell, but surely there's a cap for renting over which people just can't afford, otherwise they would buy?

Thanks for all you comments and insights.
As in this household views are very much divided.
It would seem that at least 12 of the orginal applicants want to remain on the waiting list. Several have offered to pay 6 months in advance or more to keep it for them.
As a PP has said the market has gone crazy. The right tenant for me is more important than making an extra £20 after tax.

We will probably look at it again when it becomes ready.
Thanks again

there is a shortage due to increasing regulation which now makes it very difficult to evict tenants whatever they do. Currently that reads 'impossible'. Many landlords are selling up, which was the idea, but oh...look what happens.

check that you have all the insurances including rent guarantee and legal expenses. You need to be covered when section 21 is abolished (not that it makes any difference at the moment)

it is a business, charge what the market will take. Anyone doing the 'evil landlord' thing about that is presumably offering their services at below market rate...

Thanks murbblurb. We have become more thorough over time and have quite stringent checks and references that need to be completed. We do have landlord insurance but will check that the cover still suits the current situation. Thanks for the tip!

the new checks & balances & extra expenses like electric checks increase in insurance & heightened risk re getting bad tenants out if necessary - & I am not talking about temporary short term debt.
Join NRLA by the way they are a real help & have up to date information & changes in law. & its tax deductible
Really be careful about new tenants references, financial references etc

@mumwon

the new checks & balances & extra expenses like electric checks increase in insurance & heightened risk re getting bad tenants out if necessary - & I am not talking about temporary short term debt. Join NRLA by the way they are a real help & have up to date information & changes in law. & its tax deductible Really be careful about new tenants references, financial references etc

Thank you - I will check that out as I have not been aware of it previously.