There are three ways for a landlord to increase the rent payable on an assured shorthold tenancy:
- by agreement with the tenant - this is normally done by issuing a new fixed-term tenancy agreement including the new rent amount. If this is not done, there should at least be some written record of the tenant's agreement to the new amount: e.g. a letter signed and dated by them. If the tenant has agreed to the new rent, they will not be able to subsequently challenge it.
- following a rent review clause in the tenancy agreement. The tenant will normally be deemed to have agreed to this by signing the agreement, so again will be unable to challenge it.
- by notice of increase. Landlords may serve this once a year, so long as it is done in the prescribed form (legal stationers on- and offline sell forms). Notices of increase can only come into force during a periodic tenancy (i.e. after the fixed term has expired). Tenants who wish to challenge the increase may do so by referring the matter to a Rent Assessment Committee.
But bear in mind...
Just because you can, doesn't mean you should
Some landlords think they should put the rent up every year: we disagree. Especially if there's a surfeit of rental property in your area, *and* you've got great tenants who always pay on time, consider leaving your rent as it is. A little note, maybe with a bunch of flowers, a bottle of wine or a voucher for dinner at a local restaurant, saying thanks for being great tenants, no rent increase for you can make your tenants feel appreciated, and more importantly, keep them in your property.
Putting the rent up can have repercussions for your own expenditure too: a tenant asked to pay more money is more than likely to present a landlord or their agent with a list of all those niggling little maintenance jobs that need doing - and the cost of fixing those things can easily eat up any extra cash you'd have gained.
Suzie, a tenant from north London, told us: "a year after I moved in, my landlord wanted to increase the rent £60 a month. I said fine, but all the jobs that his lettings agents hadn't done when I moved in, I wanted completed first. This included three sets of curtains, a new carpet, fixing the wallpaper that was falling down due to the cheap glue they'd used and a new cooker. I wasn't going to put up with things that should have been fixed already if he was going to demand more rent from me. I think he regretted asking in the end!"