Landlords are not allowed to increase the rent whenever they please, or by any amount throughout the tenancy. If the landlord wishes to raise the rent without your consent then the rent increase being proposed by the landlord must be fair and realistic, and in line with local rents.
How landlords can go about increasing your rent, and what specific rules they must follow, will differ based on the type of tenancy and at which point of the tenancy you’re in. This article looks specifically at rents for Assured Shorthold Tenancies in England.
When can a landlord increase the rent?
1) During the fixed term
By mutual agreement
All parties (landlords and tenants) can agree to a rent increase during the tenancy.
If you do not agree, the rent can only be increased when the fixed term ends (see further below).
If all parties do agree, a written agreement should be prepared by the landlord.
This will need to include:
- The new agreed-upon rent increase
- The start date for the rent increase
Both the Landlord and the tenant will need to sign and date this letter. Both parties should retain a copy of the same for their records. Once the new rent is paid once, this will be the ongoing rent for the tenancy.
Rent Review Clause
For a fixed-term tenancy, the rent can be increased if the tenancy agreement has a ‘rent review clause’ which allows a rent increase.
A Rent Review clause will need to state:
- When the rent increase will take place
- How much notice you’ll receive
- How much the rent will increase
Not all tenancy agreements will have a rent review clause included - so we’d recommend having a read through your tenancy agreement to see if a rent review clause is applicable.
2) When signing a renewal
If the fixed term has ended, your landlord can increase the rent when you sign a new tenancy agreement. The landlord will need to inform you of the new rent amount before the new tenancy agreement has been signed. It is up to you whether you sign the tenancy renewal.
3) Periodic tenancy
Section 13 Notice
If the fixed term has ended and you continue to rent, your tenancy will have lapsed into a periodic tenancy. For periodic tenancies, your landlord has to give you notice before they can increase your rent without your prior agreement. In this instance, your landlord must use a section 13 notice, which refers to Section 13 of the Housing Act (1988).
For monthly tenancies, the landlord will need to give at least one month's notice of the increase in rent, and the new rent must begin on the beginning of a rental period, i.e. the date when you pay your rent each month. Notices can usually only be served once per year. If the tenant disagrees with the new proposed rent, they can refer the matter to the First Tier Tribunal.
Section 13 cannot be used:
- Where a rent review clause is included in a contractual periodic tenancy.
- During a fixed term tenancy.
Summary
In short, your landlord can increase the rent when:
- All parties (landlord and tenants) agree to a rent increase with a written record of the agreement.
- The tenancy agreement is renewed at the end of the fixed term.
- A s13 notice to increase rent is provided when the tenancy has lapsed into a periodic tenancy.