The Open Rent AST says the guarantors remain responsible (“including any variations to increase the Rent whether by agreement between the Landlord and the Tenant or pursuant to a notice given by the Landlord under section 13 of the Housing Act 1988”).
Unfortunately (thanks to the government), the rent increase I propose is 20% (as a result of mortgage rate increases), which is a lot. But it would bring it up to average market rates in the area (which are rather over-inflated by new build luxury flats and a lot higher than in the borough as a whole).
I didn’t increase the rent during Covid and in fact reduced the entire amount by 28% for the lead tenant because she found it impossible to work at home with her flatmate also working at home – the flatmate left and she paid the lower amount on her own. (That was hard for me as I had no work – I work in the arts – but fortunately I received Covid grants to cover the period). Then she decided she couldn’t afford it and found a new flatmate and the rent went back to what it was.
I missed the opportunity then to increase the rent (I was more worried about energy price increases for all of us at that point), and told them both I would not increase the rent, but it would have to rise in March 2023 at the end of their new 6 mth contract. So they have had warning.
I mention this detail because I’m worried that they won’t agree to a 20% rise. If they don’t I will have to evict them, find new tenants – or put the property on the market (at not a very good time – but hey!).
If I serve a Section 13 on March 1st (when the AST goes periodic) and they don’t challenge it, they are required to pay the new rent on April 1st, which is a month’s delay.
If they choose to challenge it, it could be another few months before it is resolved at the FPT, whether in my favour (backdated to March 1st) or not. Quite a risk.
An Open Rent blog by Paul Shamplina suggests
that a Section 21 could be served at the same time as a Section 13. Why would he say that?
The mind boggles at the implications of this (but the thread is now closed to questions). Can you (or anyone) advise on that?
In the meantime I’ll politely present my lovely tenants with the rent rise – without any scary (and frankly, draconian and ill-drawn up) government forms, and see what they say.
They have very good salaries and may be OK with it – but for one it’ll represent 36% of their earnings after tax, and for the other 43%. And they both have student loans to pay off. This is not good.