I see a number of tenancies without rent increases where the tenant has been in the property for a long time. Many landlords reward tenants with below market increases in rent because they value the fact the tenant is looking after the property...
I see a number of tenancies without rent increases where the tenant has been in the property for a long time. Many landlords reward tenants with below market increases in rent because they value the fact the tenant is looking after the property and is paying the rent reliably.
Then I see what comes of this if left unmanaged, which is tenants heavily underpaying for property which could well lead to very large rent increases which a tenant would, understandably, object to or alternatively in worse case the tenant being evicted because they won't agree to an increase.
This concerns me so I think careful management in tenancy is called for.
How can you plan for future increases?
So I suggest that rent increases are addressed on a regular basis, but as we can find this uncomfortable or let slide why not pre-agree rent increases at the start of a tenancy?
For this you have done some of the ground work at the start of the tenancy. The Belvoir tenancy agreement includes a provision for increase in line with inflation based on CPIH (Consumer Price Index including Housing). This is a form of increase that a review of rent stabilisation from Camden Council felt was most practical and fair for landlord and tenant. The link is a bit of a long read but very interesting to us with a strong interest in lettings!
What happens here is that the rent can be increased once a year in like with the previous twelve months CPIH and this can go back further if not applied before the previous years. It can lead to some strange none rounded numbers for the rent but it's fair and quite public. Well reasonably public - you might need to dig around on the Office of National Statistics to find the rate but it's there.
What is the CPIH rate at the moment?
The all items CPIH annual rate is 0.4%, down from 0.6% in December. It's slightly higher than the CPI which is 0.3%. The core inflation is running at 1.1% but consumer goods are dragging the index down. A small increase at the moment - but it should be fair and applied each year for better or worse. In higher inflation times the compound effect could be large.
If your tenancy doesn't include provision for rent increases or want to talk it over if you are thinking about increasing a rent I would be happy to talk over good methods for doing this in a way that tenant. Pop in and see us on Hillingdon Hill and talk about it over a cup of tea.