Increasing rent by section 13 when there is a CPI clause?

Reply to the comment left by “Michael Barnes” at “10/03/2016 – 15:10“:

Thanks Michael, I hadn’t read that. Makes it a lot easier.

Explain to the tenant that due to changes to income tax you are no longer afford to rent to them at the current rent. As they are good tenants you are happy to give them the option of agreeing to a rent increase, otherwise you will have to ask them to leave within the next 2 months.

Explain that if they agree to the rent increase you will send them a formal letter withdrawing the S21 notice. Also explain that if they wish you are happy to give them a new AST that will prevent you from asking them to leave for 6 months.

Date the section 13 notice so that it does not take effect for two months, so if they ignore the S21 you can recover the higher rent from them for the time the eviction process takes.

Had this issue of an RPI clause in an AST in one of my properties in Grantham managed by a large chain. They said I can only raise by RPI. I said err….no…if tenant no likey serve Section 21 and then they can either sign a new agreement or find somewhere £25 a month extra. What a surprise. Tenants agreed the new rent. I now forbid this large letting agency to put this clause in agreements on my properties.

Reply to the comment left by Romain Garcin at 10/03/2016 – 12:29
I have the same story now. Tenant is paying £800 pcm from 2021. Looking to increase now to £1100. But Tenant is saying that there is a clause which states clearly that the rent will be reviewed annually and increased according to inflation.

Is there anything I can do ?

Reply to the comment left by Tuly at 14/11/2023 – 23:01
You can issue a section 21 notice for the current tenancy and offer the tenant the alternative of a new tenancy agreement at the new rent.

Reply to the comment left by Kate Mellor at 14/11/2023 – 23:29
Thanks but I have done this already. And we are waiting for the court.
In the meantime I’m trying to see how much I can increase the rent to. And even I can only increase to inflation then I would need to know what the rate is. Basically to how much can I increase the rent. ?

If you’ve issued a S21 and are awaiting a possession order from the court then I would suggest you seek advice from a property law expert before making a decision to increase the rent.
My concern is that if you increase the rent at this stage you may potentially create an offer to continue the tenancy. (Will the tenant even pay an increased rent, or simply ignore it anyway if they’re heading for an eviction?)

I can only assume that your tenant has refused your offer of a new tenancy at the increased rate you proposed, or you wouldn’t be applying to the court for a possession order.

You should probably ask your question as a brand new question on this forum. This thread is pretty old and you won’t get as many answers here.

The position of a housing lawyer I trust is that rent review clauses don’t survive into a periodic tenancy.

Reply to the comment left by David at 15/11/2023 – 14:57
That is the case when a fixed-term tenancy becomes a statutory periodic tenancy, but not if the tenancy is a contractual periodic tenancy.

The reason for a SPT is Section 5(2) Housing Act 1988 which says a SPT arises, S5(3)(e) which says the terms are mostly the same (except where later provisions say otherwise), and S6(1)(b) which the courts have decided means that rent review clauses in original agreement do not carry over.

A contractual periodic tenancy, however, does not end after the first period and so S5 and S6 do not come into effect. The terms of the CPT agreement continue until the tenancy is ended or the parties agree a change to the terms.

Reply to the comment left by Michael Barnes at 17/11/2023 – 01:15
Yes, sorry, I meant to say SPT as a CPT is periodic from the start. Thanks for the correction.