Rent increase – tenant won’t pay?

Section 13 not required if there is a clause in the tenancy agreement regarding increases. That is a big hike, inflation would only be 10% at most. What you should do is talk to the tenant and agree a fair increase. Some mortgages and market rents have gone up more than that but think about the consequences of them not paying at all…..

Reply to the comment left by Derek STOBBS at 11/04/2023 – 14:02I think you will find that the circumstances you have described (mesne profits, accepting rent after the end of the tenancy etc.) only apply where the tenant stays on after giving notice to quit and has nothing to do with the end of the fixed period under a standard AST.

Seething Landlord, I believe you may be correct there. I have only ever use Mesne profits when I have issued a S21. Even then citizens advice advised the tenant I had accepted rent, happily the magistrate knew different and gave me posession of the property. Even then it was another 3 months (with nothing paid) before the bailiffs managed to shift the incumbent out .. another property sold then.

That is quite a hike in rent. I assume you have shown why the rent has to go up so much by illustrating comparable local properties. I would try to negotiate. If he is a good tenant in other ways he will see that if he has to leave this is the sort of rent he is going to have to pay anywhere else. Please remember that the courts are broken. My last eviction cost me £25 000 in lost rent, bailliffs and legal fees and it took 18 months, It is by no means certain that the judge would side with you against an honourable tenant who had paid the original rent. Save yourself a lot of heart ache. Good luck H

Just a simple clause in any new tenancy could help solve the problem. Add a rent review clause to any new AST. The tenant will be on notice and may find the process more acceptable.

Reply to the comment left by Helen Lavelle at 11/04/2023 – 16:28
That puts things into relevant perspective Helen and very much aligns with my thinking.

I wouldn’t have raised it that much, however if the rent for that area supports the new rent then who are we to argue. Having said that, the comment about it taking 12 months or more and pots of money to evict should be borne in mind.

Tenant doesnt have to agree to a new tenancy, but can’t ignore a s13 notice. They either pay it or appeal to the tribunal.
You need something in writing from the tenant declining the new agreement.

Form 4 is the way of raising rents under S13.

Accepting tenant’s rent after fixed term simply converts tenancy to statutory periodic tenancy, or contractual periodic if covered in the AST, unless either of you has previously given notice.

Form 4 is the only way you can impose rent increase without consent of both parties, if no mention of automatic increase and basis in the AST. FTT will set rent at market rate, so if your increase will leave rent below market, the tenant would be better to negotiate a compromise rent with you.

BTW
I had to make a similar increase last month as the tenant had been given cheap rent to reflect pandemic rates. The increase was slightly higher than the previous year to bring rent to near market rates. The reason the increase was slightly higher than we both had expected was due to the significant increase in mortgage costs. Now fixed with my payments almost 50% higher – previous lender wanted to reward my loyalty by putting me on their SVR of almost 8.5% making mortgage payments larger than the new rent!

Reply to the comment left by Rod at 15/04/2023 – 13:58
So you didn’t stress test your business model against increasing mortgage costs

Niave