So as a Landlord as I am sure you are all aware we are having increased costs with mortgage rates increasing and inflation. I am very happy with my tennant however I have not increased by rental fees in over a year. As a test I relisted by property and the increased fee and now I have some serious interest and they want to view the property.
The tricky part here is the tenant is in the house and to arrange prospective tenants may upset them.
I assume it is best to tell the current tennat that I am having to increase my costs for the above reasons and plan to put the property back on Open rent. I can also tell them that I have had alot of interest at the new rate and would they like to consider matching the increased rate.
My AST lapsed and I am just on a rolling 1 monthly contract as far as I am aware.
Just thinking how the best way to proceed is, I can see the current teannts maybe a bit upset but I want to give them plenty of time to consider matching or find somehere else more suitable.
I don’t like the idea of you re-listing the property to test the market without your existing tenants knowledge. It is not fair on your existing tenant and it is not fair for prospective tenants as the property isn’t really available until you or your tenant serve notice. You check the market by comparing the rents of similar properties in the area and use your findings as a valid reason for increasing the rent as well as increased running costs etc… You say they are good tenants. Why would you want to sour this relationship in this way.
Have a discussion with your tenant about your intention to raise the rent. Give your reasons, increased costs and similar properties rent for more than they are currently paying etc. Then serve an official notice of the rent increase. If your proposed rent increase is reasonable they will more than likely agree to pay it. If they don’t they can serve notice to leave. Only then you can re-list the property and except viewings.
The property is definitely your asset but it is also the tenant’s home and this fact is equally important. What if your tenant, a friend of theirs or a neighbour had seen the advert you placed and without you talking to them first? There goes any good relationship you had with them.
My personal view: Never underappreciate a good in situ tenant. Talk to them, explain costs are going up. Expect to share some of the pain though. We can’t pass this all on to tenants. They have their own costs to meet and I assume the rent is a larger % of their income than your mortgage cost is to yours?
I have a couple of properties I have not increased for several years. Don’t forget the costs - explicit and addressing teething problems - with any new tenancy.
I send email with proposed rent increase with the
reasons and giving the tenants time over 2 months.
So both parties have time to think.
I would not advertise the property before asking and knowing the tenants decision. If tenants are good and can talk and discuss and usually outcome is good for both parties.
Why did you not tell them the rent was going up before advertising it, that seems very mean and underhand to me. Have they said they want to leave? Have they been good tenants? Why would you put the rent up more than once in the same year? I have been renting out my property for years, each time to long term tenants, 5 years, been happy for them to stay at the same rent. I have just got new tenants and written into the contract that after the first year when it becomes a rolling contract, I will review the rent, doesn’t mean I will increase it though. I suppose it depends on whether or not you have a mortgage on the property.
I think it’s definitely a touch choice. Just read that this is quite common for many landlords who have mortgage on their rental property and the increased interest rate has to drive the rent up.