‘Fair Rents’ and the Valuation Office?

by Readers Question

13:39 PM, 13th July 2020
About 3 weeks ago

‘Fair Rents’ and the Valuation Office?

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‘Fair Rents’ and the Valuation Office?

I have raised the rents in nearly all my properties over the last couple of months – all by way of S13 and letters to the tenant explaining this.

Just had the following message come back from one Council for one tenant who still receives Housing Benefit:

“Thank you for your recent communication, I can confirm that we did receive proof of Mr X rent increase. The increase cannot be considered at present, because a maximum rent has been set by The Valuation Office and we still have a valid decision from them. The current decision from the Valuation Office expires on 25/02/2021, at which point the rent will be referred to them with this increase included. Mr X has been notified of this.”

I’m totally confused!

I thought as a private landlord I can set any rent I like (but I don’t!). If a tenant is on benefits the Council use the LHA rate as guidance for rent. I always let LOWER that the LHA anyway, (and this increase will still be lower than the recently increased LHA) so can’t understand this response.

Anyone provide some clarity here please?

Reluctant Landlord



Comments

Monty Bodkin

20:34 PM, 13th July 2020
About 3 weeks ago

"I thought as a private landlord I can set any rent I like."

No. In certain circumstances, rents can be challenged, it sounds like yours have been;

https://www.citizensadvice.org.uk/housing/renting-privately/during-your-tenancy/challenging-a-rent-increase/

"If a tenant is on benefits the Council use the LHA rate as guidance for rent.
I always let LOWER that the LHA"

LHA rents are not the minimum. They are set *at* the 30th percentile of market rents. If a landlord is charging the 30th percentile for a slum property in the lowest 1% of properties, a tribunal may well find against the landlord.

(no offence, using extremes for illustration purposes)

Art Dobson

9:32 AM, 14th July 2020
About 3 weeks ago

Might be a good idea to back down on the increase, It's one of those situations where even if you are in the right and feel you are reflecting the market, the stress and bother of it all and arguing with the LA will give you too many restless nights. For the sake of what is probably £100 a month.
A good approach I take is do work on property before any rent increase, so I can honestly say i've made the house a nicer home and improved it, which usually warrants an increase.
It also adds value to your portfolio.

WP

10:21 AM, 14th July 2020
About 3 weeks ago

the increase is from £346.00 to £400 pcm. Its a one bed flat. This will be the first rent increase since May 2015. LHA currently set at £449.99. Tenant has not challenged it directly, but Council are saying no (see their reasoning as in original post)
I have just sent Council a message to ask them to clarify and quantify their reply and give details regarding the VO decision that they are quoting and I'll take it from there.

Monty Bodkin

11:13 AM, 14th July 2020
About 3 weeks ago

Reply to the comment left by WP at 14/07/2020 - 10:21
You've not seen the VOA decision? Surely as a landlord, (to all intents the defendant) you would have been informed.

WP

12:02 PM, 14th July 2020
About 3 weeks ago

Reply to the comment left by Monty Bodkin at 14/07/2020 - 11:13
not seen anything only the councils reply - that's why I'm asking them for evidence to back up what they have said. If they don't come up with a quantifiable reason... keep and eye out for my next post asking how to challenge this! 😉 LOL

Mick Roberts

5:55 AM, 15th July 2020
About 3 weeks ago

Sounds like your tenants are on the old Rent officer system, pre-dating 2008 LHA introduction. I have about 10 tenants left on the old system which was paying more than LHA for last 5 years.

This does get looked at once a year by Rent officer

Art Dobson

8:03 AM, 15th July 2020
About 3 weeks ago

Reply to the comment left by WP at 14/07/2020 - 10:21
For just £600 a year I wouldn't be getting too animated, it's small beans.

WP

9:15 AM, 15th July 2020
About 3 weeks ago

Reply to the comment left by at 15/07/2020 - 08:03
its not just one property....

WP

9:21 AM, 15th July 2020
About 3 weeks ago

Reply to the comment left by Mick Roberts at 15/07/2020 - 05:55
Mick - sorry but you seem to know more about this than me...so any tenants with a tenancy pre LHA system are all under a rent officer system? I can't even find any info on this rent officer system. When does this phase out? If there was a new TA with the same tenant would this automatically come under the LHA remit then? Confused - any advice very welcome 🙂

Mike D

21:54 PM, 16th July 2020
About 3 weeks ago

Yet another reason not to take benefit claimants i would guess

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