A lack of affordable housing and growing demand for rental properties have sent the rental market into a state of crisis, and young people are particularly affected. New data suggests that nearly four in ten renters under the age of 30 pay more than 30% of their income on rent, and some are turning to house sharing.
According to Rightmove, asking rents on property listings outside London are up 12% on the previous year, and growing at the fastest rate in 16 years. And the Office for National Statistics reports that for the year to August 2022, rents increased by 3.2% across the UK.
If you rent, you may be worried about what you can do if your landlord wants to increase the rent. There are some circumstances where a landlord can increase rents, but only by following the rules and sticking to the tenancy agreement. Tenancy law is complex, and your rights depend on the type of contract you have and where you are.
If you privately rent in England and Wales, you are likely to have what is called an assured shorthold tenancy. You would normally have a fixed-term period – usually six or 12 months, sometimes nine months for students – before the tenancy would go onto a periodic (month-to-month) open-ended tenancy.
If you have a fixed-term tenancy, the landlord could ask you to sign a new tenancy agreement at a higher rent, replacing your existing agreement. But you do not have to agree to sign this, and you can continue with the same price as your current agreement.
Alternatively, your tenancy agreement may have a rent review clause. This depends on the agreement and what is stipulated. But your landlord would have to stick to the procedure set out in the agreement. Your landlord may also ask you verbally or in writing to agree to a new rent. The government states that your landlord must get your permission to increase the rent. The rent does not increase if you do not agree.
Shelter, a housing charity, warns that if you pay the higher rent, even if you don’t agree to it, this automatically becomes the new legal rent. It is best to seek advice before paying a new rent.
If at the end of your fixed term, you do not sign a new tenancy agreement or end the tenancy yourself, your existing tenancy will continue as a periodic tenancy (rolling month to month) at the same rent. During a periodic tenancy, there are several ways for your rent to be increased. This includes, as above, the rent review clause or the landlord asking you to increase the rent and you accepting – either by paying or signing a new agreement.
The final way your landlord can increase the rent is by serving you a Section 13 notice. Your landlord can only do this once a year, they must give you at least one month’s notice, and use the correct form.
If you do not agree to the rent increase proposed under the Section 13 procedure, you can challenge the increase at a first-tier tribunal. The increase usually doesn’t apply until the tribunal has decided on whether to increase your rent, keep the rent the same, or possibly decrease it.