When can landlords increase rent?
June 4, 2025
As a landlord, one of the most crucial aspects of managing your property is setting and adjusting rent. While increasing rent can be a necessary step to cover rising costs or reflect market conditions, it's important to understand the rules and best practices to ensure you're compliant and maintain positive tenant relationships.
In this blog, we’ll explore when and how you can increase rent, taking into account recent legislative changes and practical advice to make the process smoother for both you and your tenants.
Why increase rent?
There are several reasons why you might consider raising rent:
Rising costs - Property maintenance, insurance, and other expenses may increase over time.
Market value adjustments - Local rental rates may rise, warranting an adjustment.
Property improvements - If you’ve made significant upgrades, increasing rent can reflect the enhanced value.
Keeping up with inflation - Regular, modest increases in rent can help maintain your property’s profitability.
Understanding the right timing and method for rent increases is essential to avoid disputes and keep your tenancy running smoothly.
Fixed-term tenancies
If your tenant is in a fixed-term tenancy (typically 6 or 12 months), your ability to raise the rent during this period is limited. In general:
You cannot increase rent during the fixed term unless the tenancy agreement specifically includes a rent review clause.
If the agreement allows, you must follow the terms laid out, which usually specify how and when increases can occur.
Alternatively, both parties can mutually agree to an increased rent rate, but this must be documented properly.
Periodic tenancies
Once a fixed-term tenancy ends, it usually transitions into a periodic tenancy (month-to-month or week-to-week). In this case:
You can increase rent by giving the appropriate notice, typically one month for monthly tenancies.
You must use a Section 13 notice if the tenancy has rolled into a periodic status. This formal method is required for legal compliance.
Increases must be fair and aligned with the local rental market.
How much can you increase rent?
Your rent increase must be considered fair and reasonable. The increase should align with similar properties in the area to avoid disputes. Excessive or arbitrary increases could be challenged by the tenant through a rent tribunal, where the decision may not go in your favour.
New legislation - What you need to know
In 2025, the UK government introduced the Renters’ Rights Bill, which has proposed some important changes:
Annual increase limit - Landlords can only raise rent once per year.
Standard notice period - You must provide at least two months' notice before the increase.
No automatic rent reviews - Rent review clauses are being phased out, requiring landlords to follow the official notice process.
These changes are designed to ensure that rent increases are predictable and manageable for tenants, while also keeping landlords accountable. The bill is currently being read in the House of Lords and not yet completed Royal Assent.
Best practices for communicating rent increases
A successful rent increase often comes down to how well you communicate it. Here are some tips:
Be transparent - Clearly explain the reasons for the increase, whether it’s due to market adjustments or rising maintenance costs.
Give ample notice - Even if the legal requirement is two months, providing more time shows respect and helps maintain a positive relationship.
Provide comparisons - Demonstrating that your new rent is in line with local rates can help tenants understand the rationale.
Offer to discuss - Inviting tenants to discuss their concerns can reduce tension and lead to a more amicable resolution.
How to handle tenant disputes
Even when following the correct process, some tenants may challenge a rent increase. If this happens:
Stay calm and professional - Avoid getting defensive and focus on explaining your reasoning.
Provide evidence - Share comparable local rental rates and any documentation that supports your decision.
Consider compromise - If the tenant is facing financial hardship, discuss potential payment plans or phased increases.
If the disagreement escalates, tenants can appeal to a first-tier tribunal (Property Chamber), which will assess the reasonableness of the increase. Being well-prepared with evidence can make a significant difference.
Maintaining a positive relationship
Ultimately, retaining good tenants is often more valuable than a marginal increase in rent. Consider the broader impact on your business and your property’s reputation when making your decision.
Increasing rent can be a natural part of property management, but it needs to be done thoughtfully and legally. By following the correct procedures and maintaining open communication, you can ensure that your rent increases are fair, reasonable, and accepted without conflict.
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Note: This article is for informational purposes and does not constitute legal advice. For specific concerns, consult a legal professional.
Disclaimer: This article is a guide and not intended to be relied upon as legal or professional advice, or as a substitute for it. August does not accept any liability for any errors, omissions or misstatements contained in this article. Always speak to a suitably qualified professional if you require specific advice or information.
