I have a tenant on below market rent £935 and a agent has said I could get £1200+
Any ideals what I should do , don’t mind the tenant staying but I don’t know what to increase the rent by %
Any help would be appreciated
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Agents always say such things to drum up business. You may be able to get more money, maybe even £1200, but if you have a good tenant I would suggest you increase the rent by an amount they can afford, with further increases next year etc. An increase to £1000 a month is 6.9%, which is about the underlying rate of inflation.
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Study the market to see if that rent level is realistic, use RightMove. Zoopla etc. Check volume and how long they stick around for.
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I’ve checked rightmove and the agent is spot on , I don’t think the tenant will be able to afford anymore rent and looking down the line she wouldn’t afford any more in the future, and £150 -£200ish a month is a lot over a year so it’s a section 21 time.
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I’ve been with this agent for over 12 years and he’s pretty far to be honest and he’s always got me more than I thought.
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I think you need to consider what you expect a tenant to do, ie to they have a viable option to move. If they cant afford market rates and downsizing/moving to cheaper area isn’t viable, then it is arguably in tenants best interest to stop paying your rent and force you to evict them via the courts which will leave you with no rent and lots of bills…
I have tenants in similar position who have been good but cant afford market rates but i wouldnt expect them to make themselves homeless just so i could make more money…clearly there are limits as to how much below market rates is viable but if they have been good i think you need to at least offer something reasonable to give them a choice. Just sending a s21 isn’t likely to get a positive response…
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Richard 19 all true but he has seen dollar signs .The sort of landlord that tenants rail about
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Im in a situation myself now where a few tenants are underpaying compared to market value. I will address it but i cannot but help but consider the energy issues on the horizon. Some may well be on fixed tariffs so wont feel the pinch for a long time yet. I will increase by 5% initially then another 5% in 12 months. Small amounts often is better than large amount less often.
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This is the exact situation that has led to the Government bowing to pressure to scrap s21. Landlords using the notice to get rid of otherwise decent tenants so that they could charge more money.
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Totally agree it is greedy landlords
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If you try to force her out, then you will incur huge costs from 1) her taking advice to stay put until you evict her lasting possibly up to a year 2) even if she leaves you will have a void period which costs you money
Weigh up the risks of 1) the above 2) keeping a tenant that pays regularly and looks after your property
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Colin you seem to think I am a greedy landlord?
You don’t know my situation and I don’t think being 20% under market value is greedy , far from it 2years paying under market value is a substantial sum the tenant has saved and after all I run a business and not a charity!
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Why is that wrong for a landlord who runs a business? You don’t expect Asda to let you get a discount off there baked beans ?
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When factoring in potential empty period between tenants, a staggered increase of rent may be more beneficial, spread over a period of time. A good known reliable tenant is worth something.
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When the wholesale price of baked beans doubles, ASDA dont double the price on the shelf. They increase it a bit so that people continue to buy beans and the take a hit in the short term. They understand this this is part of the cost of doing business and that they will make up the shortfall elsewhere or at a later date.
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like that reply David. But i doubt it will sway him,
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Jason-Egan 1
You asked for the help to others and others have given
their views. You and we all have to remember that one thing that agents are working and they are looking for their
commission.
The amount of increase you are asking is far too much.
You have been with the same agent for 12years so
that means got a fair idea of about the rental market,
how much to increase and when and how.
What is the market value and its all depends and varies
from one property to another even in the same street.
I know Landlords who were getting rent around
£1400-1500 have just increased rent by only about
£100 even their mortgages and service charges
expenses etc gone up several hundreds.
Also landlords who were getting about £2500
increased rent by only £200.
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I have stated that I know the agent for many years and he has been honest and I’ve looked around and the demand in Bristol is very high , I have just lett a 3 bed in 2hrs 20mins !
I have been a landlord for 30plus years and the last 3 have been a roller coaster.
I wouldn’t increase my rent if the rent was near the market rate and two houses I haven’t increased it in3 years but 22% below is a lot .
Quite apart from the ethical issues, there are a number of economists now predicting some sort of property crash/correction. If so then rents are likely to fall and the person paying the inflated rent will quickly realise they can get the same product cheaper elsewhere. The Bristol bubble could soon burst.
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Still to few houses about ? Bristol is just full of student accommodation and very little for everyone else and they are making the suburbs almost impossible to find accommodation.