Handle rent increase in long tenancy with no break clause

Hi there,
Me and my boyfriend are in a 3 year tenancy that has a yearly rent review. We asked for a long contract because we wanted stability after moving house almost every year. Because of this, we negotiated to have a limit on the rent review to 3%. This was agreed to and the estate agents put it in the contract, but, the wording tricked us. The rent review clause says it can increase the rent up to 3% or RPI so, in my opinion, that’s the same as having no limit…

Inflation has been very high and so has RPI so I’m concerned about our rent review this June.
My main concern is that it may be very high but fair, giving current circumstances, and put a strain in our finances leaving us stuck in this situation.

To add to that, a friend of mine is leaving her rented flat this June so we would have a good place to go to if we could.

Our landlord has always been very helpful and kind so we don’t want to bring any trouble to him, but at the same time we also need to take care of ourselves.

What can we do?

Thank you.

RPI is restricted, not the same as no limit, sounds reasonable to me.

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From what I saw, RPI was 15% and I don’t know how high it will be in near June, does that mean we can expect an increase of 15%? It is quite a bit on a £1250 rent that’s why I’m concerned…

Rpi is likely to be significantly lower in june as the very large energy price increase last april will no longer be included.

Some landlords will choose not to pass on full inflation increase due to high rate, all you can wait is for landlord to confirm and deal with it then.

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What is the exact wording of the rent review clause? If its as you’ve said, then the agent’s choice is only 3% or RPI, not anything in-between.

Don’t expect your friends landlord to rent you the place at the same price she’s currently paying. All rents have gone up enormously and the easiest way to bring a property up to market rent is when someone leaves.

I hope it works out for you.

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This is quite clever of the Landlord as he inflation proofed his rent. As a LL myself if you were paying the rent on time and were looking after tge property i wouldnt put your rent up until the 3 years were up but everyone us different

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@MikeL The problem with doing that is that as the rent you are charging drifts further and further away from the market rent, both landlord and tenant become trapped by it. The tenant can’t afford to move and the landlord ultimately has a property that is not working for him as an investment.

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That’s a very good point regarding energy prices and RPI. Does that mean that the amount the LL may increase is based on the percentage of RPI of the month closest to June?
Usually a tenant gets 1 month or 2 months notice of rent increase so would he base his increase on the RPI of May or April?

The contract should really state which months inflation figures is to be used for the purposes of the increase.

If it doesnt i would say the landlord can wait for june inflation figure which wont be published until mid to late july and then apply that increase with effect from august or september rent in order to give you the 1 months notice. Alternatively if he wants to increase rent from june he should use the march or april figures which are published in april or may respectively (which one will depend on your rent payment date in order to have 1 months notice) but if he does this he should only use increase since june when contract started as you shouldn’t be liable for inflation before contract started. As this is only part year the increase should be lower than annual inflation figures quoted. You can google rpi tables which would enable you to check any figures landlord uses.

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You need to reproduce the rent review clause here if you want informed responses.

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Maybe bring your friend with you and it will be cheaper living for all of You, I know it can be hard to live with someone but if you feel that you want to help your friend as well - then give it a go if feels right

Hi Daniela6,

There is no harm in contacting your landlord and asking what his plans are for June. Simply say that you are budgeting your finances and would like to build in the correct rental payment. My tenants ask me each year.

Good luck.

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That’s really awkward timing isn’t it? It does happen.

The RPI isn’t the same as “No Limit”. But as you’ve said that your landlord is pretty helpful? Well to be honest, if I were your landlord I would feel crushed if I read it on here first, it’s like saying that your landlord, who is really the first person that you should share your concerns with.

Hopefully you may be pleasentlu surprised by the landlord?. The worst thing would be to know about this, and the possible change of address in the future and trust me, your landlord will appreciate the extra time needed to find replacement Tennant’s, especially if they’re relying on your rent to supplement a pension for instance.

Just approach him/her and tell them that there’s something on your mind and tell them?. They’ll need to know at some point and the sooner the better.

Good luck, and I hope that the future treats you well, but please don’t leave the landlord oblivious okay?
Regards Lynda

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You said: ‘…we negotiated to have a limit on the rent review to 3%. This was agreed to and the estate agents put it in the contract,…’
There is an equitable remedy called rectification which applies when a document does not reflect the agreement and intentions of the parties. The law books and most reported cases stress that there must be clear evidence of what the parties agreed and intended but if this case ever came to court I think that in the current climate it’s quite possible that your word would be sufficient, although much better if backed up by some correspondence.
I had to fall back on rectification once in my career, where the final version of the travelling draft of the renewal lease of a retail property failed to include the final amendments to a clause (coincidentally it was a rent review clause) and the document was executed by someone else on our side before I had an opportunity to spot the error. The other side’s estates department balked at rectifying the mistake but their solicitor agreed immediately when I pointed out to him what had happened.
Having said all that I agree with David122 that we need to see the actual clause.

I agree with David.
Also it is affecting landlords if they are renting flats
service charges, maintain gone up and if they have
more mortgages which are on tracker/ variable or even on fixed rates coming to end then they are going up.

I know many landlords including my self started selling
At the end of tenancy even had good tenants because
not practical.
I am sure tenants would agree that if they were
landlords they would increase the rent it decide to
either to increase the rent to recover the costs or ask the tenant to end the tenancy contract.

If you are on good terms speak to your landlord. Everyone is in difficult circumstances and your landlord will be as reasonable as possible, not everyone is out to make every last penny and argue silly clauses in a contract. You will probable save yourself a lot of worry and stress by just simply talking to your landlord and finding out exactly where you stand.

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