Rent increase – tenant won’t pay?

Rent increase – tenant won’t pay?

10:29 AM, 11th April 2023, About A year ago 22

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Hello, Today I increased the rent on a flat from £1,400 to £1,600, effective 1 June 2023, which is the tenancy anniversary date.

I advised the tenant verbally and also sent the new agreement.

The tenant has stated he won’t pay.

Does anybody have any advice on what I should do?

Thank you,

Enina


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Comments

SteveFowkes

12:03 PM, 11th April 2023, About A year ago

New agreement - new tenancy or Section 13?

In either case the tenant will technically be in arrears if they don't pay the increased rent.

After 2 months of arrears you can serve Section 8 for eviction.

Or Section 21 for eviction.

Graham Bowcock

12:17 PM, 11th April 2023, About A year ago

If you have an agreement in place, you could serve a s13 notice to increase the rent - you don't need a new tenancy agreement.

There is no obligation on the tenant to sign a new tenancy agreement (and, as advsied above, it's not necessary) so the exisiting agreement will continue until you end it.

You will need to decide if it's worth ending the tenancy to secure the rent you want - we always bank on doing that will cost 3 months' rent (void period, letting costs, any prep works), which in your case would be about £4,500 - assuming your new rent is market level it will take you nearly two years to recover those costs. Is it worth it?

You can use s8 when arrears are at 2 months, but if the tenant continues paying current rent, it will be 7 months before you can do that (after the increase date).

Sheralyne Stamp

12:17 PM, 11th April 2023, About A year ago

To increase a rental income you must serve a Section 13 on the tenant giving notice. The tenant can then refuse to pay or engage the services of the officer of fair rent for your area.
Was this a rental increase on a periodic tenancy or a tenancy coming to an end of a fixed term? If on a periodic then Section 13 must be served. If fixed term coming to an end and the increase to commence at the start of the new agreement and tenant refuses then you need to serve a section 21 notifying them that you will not be renewing the tenancy and give them 2 months to vacate should they not vacate then you will need to take the matter to court for possession

GlanACC

12:31 PM, 11th April 2023, About A year ago

Did use use FORM 4 which is the official method of increasing rent, otherwise the tenant can ignore your request. (Google Form 4 its on the government web site)

RoseD

12:57 PM, 11th April 2023, About A year ago

At least they've told you they not willing to pay the rental increase which in real terms is a massive hike based on what? If it's because you jumping in the band wagon of greed...is it worth evicting a good tenant to expose yourself to a possible bad? Your call obviously but as already pointed out if you'd evicted to get higher rent you have to factor in a void period which is likely at least a month's rent plus the hassle/stress you now impose on yourself deciding what to do about the situation.

robert arnold

13:10 PM, 11th April 2023, About A year ago

Just because you can doesn't mean you do.Good tenants and fair rent go hand in hand.Be realistic and fair it will work for everybody

Crouchender

13:10 PM, 11th April 2023, About A year ago

You could negotiate as a 12.5% increase for existing tenant might be a bit high to digest. Could you agree 10%? Check what the rates are locally. The BBC does a good calculator to state what rate your rents in your local area are increasing year on year.

Ie Justify your increase.

I never use Form 4 on fixed term agreements as too formal and adversarial. I just issue another fixed term AST with the new rent long with all the other relevant paperwork to be resigned.

I understand as a LL you want to increase rent as you need to cushion yourself when Labour get in next year with freezes and caps galore!!!!

Seething Landlord

13:14 PM, 11th April 2023, About A year ago

As the tenant will not agree to the proposed increase your only option is to serve a S13 notice. The tenant can then either start paying the new rent from the specified date or refer the matter to the FTT who will determine the correct rent for the property. If he does nothing the proposed rent becomes the actual rent on the specified date and arrears will start to accumulate if he does not pay the extra. His alternative is to try and negotiate a compromise with you but what he cannot do is simply refuse to pay the increase.

You are not able to unilaterally end the existing tenancy and issue a new agreement. If the tenant remains in occupation after the end of the fixed term it will become a statutory or contractual periodic tenancy depending upon the way in which it is drafted.

GlanACC

13:56 PM, 11th April 2023, About A year ago

RoseD, I agree that it isnt worth evicting a good tenant. I now have 6 left oit of 18 and I have guaranteed that if they pay on time I will never evict them (all properties are paid for) and will set my rent at 5% less than the median for the area. They know where thay stand and know where I stand.which is a perfect relationship.

GlanACC

14:02 PM, 11th April 2023, About A year ago

If you accepy rent after the tenancy period has ended then you may be deemed to have started a new agreement BEWARE od this. You can accept payment but make quite clear to the tenant that it is NOT rent but is treated as MESNE profits (google it). That means you can accept payment without starting a new agreement by default.

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