Are landlords currently entering into first and second year renewals of AST with the rent increase linked to RPI? If so what are the RPI collar and cap rates that you are entering into?
Hello Priya,
I include a rent rise 1.75% in all my London property ASTs. This is because I know the rents here rise steadily in line with house prices. It is only activated upon renewal, as opposed to annually, although most tenants are keen to either renew or leave (I have had exceedingly few periods on a rolling contract).
I have not considered linking rent to RPI although I see the clear sense in this. Would CPI not be a more appropriate index due to its calculation including variance of housing costs over time?
Best regards,
Simon